The NZ housing paradox that isn’t going anywhere
Sunday, 21 June 2026
New Zealand has a divided mind on what to do with our housing wealth, while our politicians rely on it to fund their promises.
New data from The Post/Freshwater Strategies poll with Infrastructure NZ showcases the long-term paradox at the heart of both our housing and retirement debates: People want housing to be far more affordable, but also think those that are reliant on housing wealth for their retirement deserve to keep it.
This inherent contradiction is likely to bedevil New Zealand’s political economy for years to come.
We mostly agree on the problem
The polling suggests almost three in four Kiwis (75%) agree with the statement: “Owning a home has become out of reach for most young people.”
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Unsurprisingly, young people are the most likely to believe this, with about far more under 54-year-olds agreeing with the statement than over 55-year-olds.
House prices remain high by historic standards even if they are down on several years ago.
In April the median house was worth about six times the median household annual income - about twice what it was in 2002. That is obviously down from its peak in 2021, when the ratio was more like eight times, but still about twice what economists traditionally considered to be affordable.
A smaller proportion of Kiwis are particularly exercised about the problem.
Just one in 20 (5.2%) named housing supply and affordability as their most important issue. Almost one in four (23.7%) named it as one of their top three concerns, with younger Kiwis again far more likely to see it as a top problem than older ones.
But do we want to do anything about it?
While Kiwis might generally worry about the high cost of housing, they are also worried about how any fall might impact their retirement.
About $1.66 trillion is locked up in residential property wealth, according to the Reserve Bank - and almost everyone is relying on it in some ways, whether as a buffer for retirement, or as the source of new taxes to fund new social services.
Two thirds (66%) agreed with the statement that “those who built wealth through property should keep the full benefit”. The proportion of people who believed this was roughly equal across generations, despite the massive variance in home ownership.
Interestingly, it was also roughly equal across income bands - those who make under $70,000 a year are slightly more likely to believe it than those who make more, but the variance is not large.
There is a big variance by politics however. Almost all ACT voters agreed with the statement, while many Green voters did not.
Part of this is likely due to the polarisation of this issue, with the left often pushing for some kind of taxation of property wealth either through a capital gains tax (CGT) or a wealth tax, while the right has strongly resisted this.
There is a generational split if you ask a related but different question that blames not individual property-owners but government policy.
Asked whether 'government policy does too much to protect the wealth of older New Zealanders', the country split almost evenly: 35% agreed and 28% disagreed, with the rest unsure or sitting in the middle. Under-35s were much more likely to agree than disagree, while the over-55s were far more likely to disagree.
So while there might be a majority of the country who believe that those with a lot of property wealth should be able to keep it, there is far lower support for the policy settings that drove that wealth in the first place. And the younger generation is not happy about it.
The retirement conundrum
The paradox flips again when we ask people how reliant they are on housing wealth for their retirement. Here it is not actually older people who are most reliant - but the young, who may have bought near the peak.
A large segment of society admitted they were “reliant” on the value of their property to fund their retirement - 38%, compared to 50% who said they were not reliant on it.
National voters were far more likely to say they were reliant on property to fund their retirements, with 56% saying they were, compared to 35% of Labour voters and just 20% of Green voters. Higher income voters were also more likely to cite reliance on property investment for their retirement.
That reliance helps explain why so many are nervous about prices heading the other way. Asked how a significant fall in house prices over the next few years would affect their ability to retire comfortably, 56% said it would have some impact, with a third (34%) saying the hit would be major or moderate. Only about a third (33%) said it would make no difference at all.
The exposure is greatest for those in the thick of their mortgage years. Among 35 to 54-year-olds, 43% said a fall would do major or moderate damage to their retirement plans, and just a quarter said it would have no impact. Those aged 55 and over — many of them mortgage-free — were the most insulated, with nearly half (47%) saying a fall would not affect them at all.
The political pattern is almost the mirror image of who wants to protect property wealth. National voters, the most likely to say they were relying on property, were also the most exposed to a fall: two-thirds (66%) said it would hit their retirement, and 42% said the impact would be major or moderate.
Housing Minister: No easy fix
Housing Minister Chris Bishop is no stranger to this contradiction.
In 2024 as house prices were already on their way down he made headlines for confirming that he wanted them to fall further - to make housing more affordable.
This is an openly different stance to Prime Minister Christopher Luxon, who said in 2025 he wants to see “modest” and “consistent” house price increases.
Bishop told the Sunday Star-Times he was not surprised by the amount that people relied on their homes to retire.
“For most people, their home is their biggest asset, and you know many people sell their home and downsize or move to a retirement village or change their life circumstances as they age and retire,” Bishop said.
He said fixing housing affordability was crucial to actually driving sustainable economic growth through productivity gains however.
“We're focusing on fixing the underlying system settings of our housing crisis, and we're focused on doing what the experts have said needs to be done around land supply, infrastructure funding and financing and incentives for growth. That’s one of the single most important things we can to drive productivity in the New Zealand economy and create a more liveable New Zealand.”
Yet much of the economy and politics of New Zealand seems reliant on rising house prices.
At the Budget, Treasury analysts said they expected house prices to grow at around 3-4% every year for the next four years, and said this would support “household wealth and confidence”.
This moderate but real growth is being relied upon by many people - including Labour MPs, who have built in this growth to their CGT projections. That CGT money has been allocated out to free doctors visits, free maternity scans, and free prescriptions. But it will only work if there is actual capital gains happening.
Chris Hipkins told journalists this week that if house prices really did end up not growing at all for the next four years, it wouldn’t be just his CGT that would be in trouble.
“If house price growth is lower than that, there are going to be a lot of areas of the Government Budget we are going to have to look at again.”
Given how many people are reliant on some level of housing wealth for their retirement, he might be right.
– Additional reporting by Nick James
Freshwater Strategy interviewed 1038 eligible voters in New Zealand, aged 18 and over, online between June 5 and 11. The margin of error is +/- 3%. Data are weighted to be representative of New Zealand voters.
The Post/Freshwater Strategy poll is funded by Infrastructure NZ to encourage debate about issues that are important to the future of New Zealand.