九一星空无限

ZB ZB
Opinion
Live now
Start time
Playing for
End time
Listen live
Up next
ZB

‘Middle class struggle’: Housing costs hit essential workers

Author
RNZ,
Publish Date
Tue, 18 Mar 2025, 1:16pm
Home in Place's Rotorua development of 58 homes has 28 designated affordable rental properties. Photo / Home in Place
Home in Place's Rotorua development of 58 homes has 28 designated affordable rental properties. Photo / Home in Place

‘Middle class struggle’: Housing costs hit essential workers

Author
RNZ,
Publish Date
Tue, 18 Mar 2025, 1:16pm
  • A new housing development in Rotorua will offer homes at 80% of market rent for essential workers.
  • The project, led by Home in Place, aims to ease financial burdens for workers in sectors like nursing and education.
  • Economist Craig Renney highlighted that rising rents are outpacing wages, making it hard for 鈥渕iddle class鈥 professions 

By Susan Edmunds of 

A new affordable housing development that will provide homes at 80% of market rent to essential workers highlights that even 鈥渕iddle class鈥 people are struggling to cover basic costs, one economist says.

The Rotorua development of 58 homes has 28 designated affordable rental properties.

It is led by not-for-profit community housing provider Home in Place, in partnership with the Ministry of Housing and Urban Development and Watchman Capital through the Affordable Housing Fund.

鈥淗ousing affordability is one of the biggest challenges facing our essential workers,鈥 Home in Place chief executive Larissa Bridge said. 鈥淲e need solutions that provide stability and security for the people who look after our health, educate our children, and respond in emergencies. This development is a direct response to that need.鈥

The three-bedroom homes are designed for 鈥渕oderate-income鈥 earners in sectors like nursing and education and will become available later this year.

Bridge said high rents could be a challenge for people working in those areas.

鈥淲hile rents increase, the cost of living increases, unfortunately wages haven鈥檛.鈥

She said the market rent for similar homes, as set by Tenancy Services, was $650 a week, so they would be rented for $520, which would save tenants $6760 a year.

鈥淚t significantly eases the financial burden of the cost of living for those key workers who support the community of Rotorua.鈥

Some might be locals looking to upgrade their homes, she said, while others might be moving into the area.

FinCap senior policy adviser Jake Lilley said he had heard anecdotes from financial mentors who were shocked that people with 鈥渒ey roles鈥 in communities struggled with the cost of living sometimes.

Council of Trade Unions policy director and economist Craig Renney said there were parts of the country where it would be relatively affordable to live on a teacher or nurse鈥檚 salary, but others where it was not.

鈥淵ou鈥檝e got a national pay scale but you have local challenges in housing markets,鈥 he said. 鈥淭rying to be a new primary school teacher in Queenstown is much harder than in Masterton, for example.

鈥淲hat this is identifying is the professions people previously considered well paid or at least middle-class can now struggle to pay rent.鈥

He said it was a result of rents rising faster than wages.

鈥淚f we want to build a cohesive community that has all the skills we want in there, teachers, doctors, nurses, then we either pay them more so they can afford to lead a decent life, or we provide housing and pay them more 鈥 the fact we鈥檙e having to have this conversation tells you something.鈥

But he said while it was useful to help 鈥渆ssential鈥 workers, it would not be positive if there was a shift to saying that some people鈥檚 skills deserved special treatment while others didn鈥檛.

鈥淭hen you start making value judgments 鈥 the more we can supply good-quality housing in locations around the country, that鈥檚 great.鈥

Many of these roles could receive yet higher pay rates in Australia, he said.

Someone earning a teacher鈥檚 starting salary of $60,000 and living alone would spend 50% or more of their income in 25 regions of the roughly 65 in New Zealand, according to Corelogic data.

Home in Place's Rotorua development of 58 homes has 28 designated affordable rental properties. Photo / Home in Place
Home in Place's Rotorua development of 58 homes has 28 designated affordable rental properties. Photo / Home in Place

Someone earning $100,000 would spend 30% or more of their income in 25 regions.

Both teachers' and nurses' pay progresses on a scale that reaches about $100,000.

CoreLogic chief property economist Kelvin Davidson said renting was expensive at the moment.

鈥淥f course, given rents tend to be determined by tenants' income rather than landlords' costs, the current high starting point potentially suggests only limited scope for further rental growth in the near term.鈥

Financial coach Shula Newland said she had dealt with hardship applications from police wanting to access their superannuation savings.

鈥淏ut everyone鈥檚 circumstances are different, normally people are struggling because of their circumstances. Those with investment properties are hardest hit as they got double mortgage increases.鈥

She said $30 an hour was now a 鈥減retty typical low wage鈥.

鈥淲hile rents increase, the cost of living increases, unfortunately wages haven鈥檛.鈥

She said the market rent for similar homes, as set by Tenancy Services, was $650 a week, so they would be rented for $520, which would save tenants $6760 a year.

鈥淚t significantly eases the financial burden of the cost of living for those key workers who support the community of Rotorua.鈥

Some might be locals looking to upgrade their homes, she said, while others might be moving into the area.

Take your Radio, Podcasts and Music with you