social housing<\/a> tenants have to pay – from 25% of their income to 30% – leaving them about $30 worse off each week.<\/p>\nIn the 2023 Census, 26.5% of renting households had rent costs of at least 30% of income, up from 26% in 2018 and 24.2% in 2013.<\/p>\n
Of those, 18.3% had costs of 40% of income or more and 12.8% were spending 50% or more.<\/p>\n
Those levels were constant from 2018 but up from 2013.<\/p>\n
Infometrics principal economist Nick Brunsdon said 30% of income on housing costs was a good rule of thumb.<\/p>\n
“But it is just that, a rule of thumb. It has grounding in where housing affordability sat historically, but that is less relevant today.<\/p>\n
“We often use the 30% rule as a benchmark over time – how many households are paying more than 30%, and how has this grown over time? But that’s taking it as line in the sand, not saying that people paying 29% of income on housing costs are a-okay.”<\/p>\n
He said there were two problems with using that measure for households at both the bottom and upper ends of the spectrum.<\/p>\n
“For a low-income household – let’s say a sole parent on Jobseeker Support in social housing ($521 per week net).<\/p>\n
“For them, 30% of income works out to $156 per week to go on housing costs. Furthermore, 30% of income on housing implies 70% of income has to cover everything else – food, transport, health, utilities – which implies $365, which is going to be pretty tight for a parent and a child.”<\/p>\n
“Someone in this position in a private rental instead of social housing would also get Accommodation Supplement, up to $235 per week, but would also be facing much higher rent costs that are not pegged to their income.”<\/p>\n
“For mid to high income households – let’s say a couple both working full time, at the national average of $81,900 in 2025, that’s $2400 per week net – 30% works out to $734 per week for housing costs, which would be enough for renting a whole house most areas (more than average rent for every city and district).”<\/p>\n
“That leaves $1712 per week for everything else, which is probably more than enough, so that couple could afford to spend more than 30% of their income on housing costs – say if they were paying off a mortgage.”<\/p>\n
“There can be a wide range of incomes for people in social housing, but the main challenge I see with applying the 30% rule in a rigid way to social housing tenants is that it doesn’t leave much income for the rest of their costs.”<\/p>\n
Fincap said people financial mentors dealt with were paying a median 36.68% of income on rent in 2024, up from 35.8% in 2023.<\/p>\n
Fincap spokesperson Jake Lilley said any increase would cause a tradeoff elsewhere and current benefit levels were extremely difficult to live on before any changes.<\/p>\n
“Our annual Voices reports always show at least half of those supported by a financial mentor being in a weekly budget deficit.<\/p>\n
“The changes announced will also inevitably bring more demand for already stretched financial mentors. More households will seek help to try and rearrange expenditure around the change.<\/p>\n
“FinCap recommends a $30.5m per annum increase in sustainable funding for financial mentors with at least $5.5m more in funding from government. Such investment can ensure timely access to essential help so people can plan to get a bond arranged, get the power on and get food on the stove while keeping up the rent.”<\/p>\n
Simplicity economist Shamubeel Eaqub said lower-income people would have more of their remaining money taken up by essential costs such as housing and utilities.<\/p>\n
Whether 30% was a reasonable level of spending depending on the amount of income being earned, he said.<\/p>\n
“I guess the benchmark is whether these people are living a comfortable life now at 25%.”<\/p>\n","protected":false},"excerpt":{"rendered":"About a quarter of all renting households are paying 30% or more of their income in rent, Stats…\n","protected":false},"author":2,"featured_media":442219,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[138,2917,219,687,111,139,69],"class_list":["post-442218","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-cost-of-living","tag-economy","tag-housing-and-infrastructure","tag-new-zealand","tag-newzealand","tag-nz"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/442218","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=442218"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/442218\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/442219"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=442218"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=442218"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=442218"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}