Income up, housing costs up

Stats NZ reports:

The latest Household Economic Survey (Income) shows average annual household income rose 9.1 percent in the two years to June 2014, from $81,227 to $88,579.

That’s a big increase. Inflation over those two years was 2.3% so average household incomes have risen 6.6% in real terms.

Median household incomes also up strongly – 7.8% over two years.

In the same period, average household weekly spending on housing costs rose 11.1 percent, from $256 to $284.

So incomes went up $7,352 on average and housing costs up $1,460.

“The increase in housing costs was largely due to higher mortgage and rent payments, as well as an increase in property rates,” labour market and household manager Diane Ramsay said.

“A really interesting shift we’ve seen is that a bigger proportion of mortgage spending is going on repaying the principal than on covering the interest payments.”

Paying off more of the principal is a good thing.

Some other interesting stats:

• 27% of households in the bottom income quintile say their income is inadequate to meet their needs, as do 5% of households in the top quintile
• Age has a significant factor in income. Under 20s have a median income of below $1,000, 20 to 24s a median income of $28,000 approx, 25s to 29s are $37,000 approx, and 30s to 60s are $47,000