An affordable mortgage is generally 30-35% of your income, but Kiwis are paying more

Saturday, 13 June 2026

The average New Zealand household now spends 40% of its income on mortgage payments, well above the 30-35% level generally considered affordable.

Wairoa is one of the country's most affordable districts, where local households spend about a quarter of their income on a mortgage and can still buy homes for less than $400,000.

Wellington is now more affordable than Christchurch, while Queenstown remains the least affordable market in the country, with mortgage costs equivalent to 87% of the average household income.

When Matteo Garbagnati and Gabriella Kopacikova left Auckland for Wairoa back in 2014, their dream of owning their own home finally stopped feeling out of reach.

“We put offers in on a few properties for sale in Auckland but we were always priced out. It didn’t work, so we kind of parked the idea,” says Matteo.

After a few years in Wairoa, the two architects bought a three-bedroom house in town for $121,000.

They settled on the run-down home early 2020, then spent about $200,000 and 5 years of their own labour to renovate it to the highest environmental standards, and now live there with their two children, aged 5 and 3 months old.

“I wouldn’t go back to being full-time employed in Auckland,” Matteo says. “Here we’ve had time to work on the house and actually be with our kids.”

The family lives in one of New Zealand's most affordable places to own a home. Alongside Clutha and Rangitīkei, households earning local incomes and buying locally spend about a quarter of their income on mortgage payments.

Make sure you check out our graphics below to see how your region stacks up.

“You can still buy a house for relatively little money, do it up and make it very nice and comfortable in Wairoa,” Matteo says. “It’s honestly the best house we have ever lived in.”

Moving from New Zealand's biggest city to a town of now almost 10,000 people took some getting used to.

“Wairoa’s a little place,” Gabriella says. “The commuting is within five minutes. You’re everywhere by walking or bike. The lifestyle is what we were looking for.”

Infometrics estimates average household income in Wairoa is $108,797, while Cotality puts the average home value at $379,869, making home ownership within reach for many.

What makes Wairoa stand out even more is that housing is about 29% more affordable now than its long-term average, not because prices have fallen dramatically, but because incomes have risen.

“Way back 25 years ago, incomes were very low,” Cotality chief property economist Kelvin Davidson says. “Over time, incomes have gone up in Wairoa and it’s improved housing affordability.”

Email Stuff’s Chief Property Correspondent Janika ter Ellen: janika.terellen@stuffdigital.co.nz

Local real estate agent Vern Withy of Property Brokers says he’s sold his last two properties to first home buyers looking for affordability.

“The sweet spot is sort of the $280,000 to $350,000 range. People are becoming aware that, with what they’ve got in KiwiSaver, they could possibly be in the market.”

A smaller part of the town in North Clyde has seen property values drop because of flooding from Cyclone Gabrielle in 2023 and another major flood in 2024.

“One side of the town is still out of action, pretty much,” Mayor Craig Little says. “The banks won’t lend any money because you can’t get full insurance, so that’s definitely hit us hard.”

QV valuer Damien Hall says some flood-affected properties have lost more than 35% of their value because mortgages and insurance are harder to obtain.

Withy agrees and says sellers across the river face a difficult reality.

“I’ve been asked to do lots of appraisals over that side of the river, but I’ve been honest with them and said, ‘Look, you’re better off if it’s rented.’ They’ve been selling around the $250,000 mark for lovely properties. On the other side of the river, they’d be closer to $350,000.”

Despite that, Wairoa's house prices have still risen over time. QV figures show average property values are nearly 44% higher than six years ago, pre-Covid.

Little credits the region’s rising incomes to farming, the meat works, iwi investment, Provincial Growth Fund spending and remote workers bringing big-city salaries into the district.

“If you're up in Auckland and you've got a massive mortgage, you can sell up there, buy a home here outright and still do what you did in Auckland,” he says. “and there are government workers here working from home.”

He says the town has gone from building four new homes a year to as many as 50, helping fuel what he describes as a much more optimistic mood.

“Twenty years ago we were managing a downhill spiral. Now there's a really positive vibe.”

A surprise in the numbers

One of the biggest surprises in the data is that Wellington is now more affordable than Christchurch if you're earning and buying in the same place.

The average Wellington household earns $188,177 and spends about 34% of its income on mortgage payments. In Christchurch, the average household income is $131,234 and households spend about 38% of income on a mortgage.

The shift follows a sharp drop in Wellington house prices, while incomes have remained comparatively high.

Auckland is the least affordable of the major centres. Households spend an average 47% of their income on mortgage payments. The figure is 45% in Tauranga and Nelson, and 37% in Hamilton and Dunedin.

Check the two graphics below to see how your region compares.

The rest of New Zealand

The average household buying the average home New Zealand today would spend 40% of income on mortgage payments.

And most new home owners taking on mortgages at the moment are spending at least that much, because the less affordable places have higher populations.

Average household now income according to Infometrics sits at $147,909, while the average home is worth $808,187.

Using Infometrics income data and Reserve Bank mortgage data, Cotality has helped us to compare local incomes with local house prices across the country. The figures include wages, salaries and benefits, but not investment income.

So the measure reflects what ordinary working households can afford if they earn and buy in the same place.

International benchmarks generally consider housing affordable when mortgage payments consume no more than 30% to 35% of income. Most New Zealand regions still sit above that threshold.

Why are Queenstown's numbers so extreme?

Queenstown is by far the least affordable place to earn and own.

A household earning a typical local income of $148,509 would need to spend 87% of that income on mortgage payments if they bought today, because average home values now exceed $1.9 million. In other words, it would be impossible.

Simplicity managing director Sam Stubbs says the gap exists because local wages are competing against a housing market driven by outside wealth.

“That’s why you've got large numbers of people travelling through the gorge from Cromwell to do jobs in Queenstown. Or you've got 12 people to a house. Go up into the hills and you'll see people sleeping in vans.”

Queenstown is now 19% less affordable than its own long-term average over the last 20 years.

Stuff has taken deeper look at Queenstown's housing market here.

Affordability is more complicated than a percentage

Davidson says affordability is absolute, but also relative.

“If you earn a million dollars, spending 35% of your income on housing is a heck of a lot of money. But you've also got a heck of a lot of money left over.”

Smaller towns can offer cheaper housing, but they may also offer fewer employment options if someone loses their job.

Davidson also notes some areas have also become less affordable compared with their own long-term history, even if they still look cheap beside the rest of the country.