{"id":263841,"date":"2026-02-02T12:34:08","date_gmt":"2026-02-02T12:34:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/263841\/"},"modified":"2026-02-02T12:34:08","modified_gmt":"2026-02-02T12:34:08","slug":"average-households-got-a-17-3-reduction-in-interest-payments-in-2025","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/263841\/","title":{"rendered":"Average households got a 17.3% reduction in interest payments in 2025"},"content":{"rendered":"

Average households benefited from a 17.3% reduction in interest costs in 2025, according to the Household Living-Costs Price Indexes (HLPIs)<\/a> for the period to December released by Statistics NZ on Monday.<\/p>\n

The impact of the interest rate reductions was such that the increase in the cost of living for the average household in 2025 was just 2.2%, which is considerably lower than the official rate of inflation – 3.1%<\/a> – in the same period, as measured by the Consumers Price Index (CPI).<\/p>\n

The significant difference between Stats NZ’s household living-costs price indexes (HLPIs), and the CPI is that the HLPIs include interest payments, while the CPI instead includes the cost of building a new home. The cost of building a new home rose 1.2% during 2025.<\/p>\n

What this has all meant is that while mortgage interest rates were going up the HLPIs were higher than the CPI – but now they are lower.<\/p>\n

Stats NZ says the HLPIs measure how inflation affects 13 different household groups, plus an all-households group (an average household). In contrast, the CPI measures how inflation affects New Zealand as a whole.<\/p>\n

The HLPIs hit 8.2% in the 12 months to December 2022, while the most recent high for the CPI was 7.3% in June 2022.<\/p>\n

<\/p>\n

Stats NZ’s prices and deflators spokesperson Nicola Growden said superannuitant households experienced the highest inflation rate at 3.8% (as measured by the HLPIs).<\/p>\n

“The main contributor was local authority rates which increased 8.8%. This contributed nearly one-fifth of their overall inflation. Electricity, which increased 12.1%, and health insurance, which increased 20.3%, were the other key contributors to their latest increase.<\/p>\n

“Superannuitants are more likely to own their own homes and not have a mortgage. Higher prices for local authority rates have more impact on superannuitants than on other household groups,” Growden said.<\/p>\n

Among superannuitants, 85.7% own their home and 8.5% have a mortgage.<\/p>\n

Stats NZ said that the highest-spending households recorded the lowest inflation rate at 0.8%. The main contributor was an 18.6% decrease in mortgage interest payments.<\/p>\n

Among highest-spending households, 82.3% own their home and 57.2% have a mortgage.<\/p>\n

“Since these households spend a higher proportion of their expenditure on interest payments, particularly mortgage interest, falling interest rates have kept their living cost increases comparatively low,” Growden said.<\/p>\n

Rent increased 1.9% over the year and was the main contributor to rising living costs for beneficiary households. Rent contributed 18.4% of their annual inflation rate of 3.1%. M\u0101ori households were similarly affected, with rent contributing 17.3% of their annual inflation rate of 2.2%.<\/p>\n","protected":false},"excerpt":{"rendered":"Average households benefited from a 17.3% reduction in interest costs in 2025, according to the Household Living-Costs Price…\n","protected":false},"author":2,"featured_media":263842,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[138,219,111,139,69],"class_list":{"0":"post-263841","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-new-zealand","11":"tag-newzealand","12":"tag-nz"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/263841","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=263841"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/263841\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/263842"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=263841"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=263841"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=263841"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}