And more interestingly, where we are fooling ourselves into thinking we’re doing ok.
Demographia’s International Housing Affordability Survey tells us that New Zealand has the highest ratio (5.2) between house prices and income anywhere bar Australia (where they have a capital gains tax and foreign buyer restrictions). While a house in the average city of over one million population costs 3.6 years’ income, in Auckland it is 8.2. The Demographia data covers literally hundreds of housing markets and presents compelling evidence that it is the supply of land that city councils will let you build on that affects affordability. Auckland’s result is no surprise given Auckland Council’s fetish for forced intensification.
Australia, France, Germany, the U.K, Belgium, Spain, Ireland, the U.S. and basically every other developed country is in the process of raising its retirement age, or at least has announced it will. At the 2006 census New Zealand had five workers per retiree, by the time current students retire there will be only two workers per retiree. The interesting thing is it’s not really an issue for current or imminent retirees; they’re fairly safe unless there is a radical upheaval. It is however an issue for the young. Sadly, John Key’s Prime Ministership will be remembered for delaying the inevitable pension age adjustment as much as for the flag referendum. Read more »