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Affordability of Housing: Concepts, Measurement and Evidence - WP 06/03

4.3  Other Cross-sectional Variations

4.3.1  Variations across household types

We have calculated the proportion of households who spend more than 25% of their disposable income on housing costs[19], for various housing compositions (Figure 12). This data was sourced from Statistics New Zealand (HES), and uses the methods described earlier.

Figure 12 – Proportion of households spending more than 25% of disposable income on housing costs, by household type

All compositions follow a similar trend to the Total line (discussed in Section 4.1.1), involving declining affordability through the late 1980s and early 1990s, followed by some improvement. Unsurprisingly, households with one parent and dependent children fare the worst of these types, with their affordability significantly worse than for a couple with dependent children.

However the ‘one parent with dependent children’ households has experienced the greatest improvement from their late 90s peak. In 2004, ‘couples only’ had similar affordability on this measure to 1998 and 1995. ‘ Couples with dependent children’ had similar affordability to 1995. But ‘one parent with children’s’ affordability was the best since 1990, and over 25% better than in 1997 and 2001.

4.3.2  Variations across ethnicities

Figure 13 shows the proportion of households spending more then 25% of their disposable income on housing costs, by ethnicity. A respondent’s ethnicity is self-identified, and multiple ethnicities are possible. The data is the same as for the similar calculations above.

Figure 13 – Proportion of households spending more than 25% of their household disposable income on housing costs, by ethnicity

In the mid-80s, all ethnicities shown here had similar affordability values. While all groups experienced deteriorating affordability from 1984-1997, it was much more marked for the ‘Other’ and Maori ethnic groups. However, since 1997 Maori affordability has improved significantly to a similar value in 2004 to that of Europeans, whose value has largely remained constant since the mid-90s. The Other group’s figure has improved since 1997, but their housing remains substantially less affordable than that of Maori and Europeans.


  • [19]We chose the somewhat arbitrary benchmark of 25% because that is what Statistics NZ uses.
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