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Introduction and background

Why home ownership is important

Housing is a significant part of family wealth in New Zealand, with home-ownership providing a means to pass on resources between generations. Comparative studies show the amount of family wealth tied up in housing in New Zealand is greater than in many other countries, such as the United Kingdom (Thorns, 1995). Information from the 1990 New Zealand Planning Council (in Thorns, 1995), the 2001 Housing Savings Survey (HSS), and the longitudinal Survey of Family, Income and Expenditure (SoFIE), reinforce the importance of property in the net worth of New Zealanders.

For example, the 1990 NZ Planning Council study found that in 1985 around half of all household wealth came from owner occupation (in Thorns, 1995). Evidence from SoFIE (Statistics New Zealand, 2008) shows that family net worth was much higher when property was owned. Property ownership includes holiday homes and investment properties as well as the family home.

Secondly, health research shows that regardless of cost, housing tenure type affects the health and life expectancy of occupants. This may be partly due to an increased sense of agency – having a sense of greater control over one’s circumstances – and to factors such as tenure insecurity and housing quality (Howden-Chapman & Wilson, 1999).

Renting is associated with greater residential mobility (Statistics NZ; 2008, 2015) and evidence shows that frequent moves are detrimental to health and well-being (Howden-Chapman & Wilson, 1999). Recent research from the Growing Up in New Zealand study (Morton et al, 2014) found that between birth and nine months, “children born into families residing in private rental accommodation were the most likely to have experienced early mobility, with nearly one in two (49%) having moved at least once, compared to fewer than one in five experiencing mobility if their families were home owners”.

Rental housing in New Zealand tends to be of poorer quality (BRANZ, 2010; Statistics NZ; 2013, 2015). Boston & Chapple (2014) note that living in poor quality housing particularly affects children because they spend much of their time at home. Older people and people who are immune-compromised are also more vulnerable to poor quality housing.

We’ll explore evidence on housing quality from the 2010 and 2014 General Social Surveys.

Some renting issues could be overcome. For example, economists Eaqub & Eaqub (2015) cite evidence from Europe where government regulations ensure greater stability of tenure and better quality of rental housing. However, they acknowledge that “unless rental conditions are improved, ever larger numbers of New Zealanders will be living the renter’s precarious life of uncertainty and hardship”.

Māori and Pacific people’s tenure aspirations

Although different cultural values can be placed around home, and home ownership, research indicates that both Māori and Pacific people aspire to home ownership. However, this would benefit from further investigation as much of the research is from the 1980s and 1990s. Has the overall drop in home ownership since the 1990s, and discussion of the reality of ongoing renting for many people (Eaqub & Eaqub, 2015) affected people’s aspirations? In particular, it would be interesting to study the effect of rising house prices in Auckland.

Waldegrave, King, & Walker (2006) looked at research around Māori aspirations for home ownership and found that Māori did aspire to home ownership but faced numerous barriers. These barriers included the difficulties of developing land with multiple owners in rural areas, lack of financial resources, and knowledge and support around the process of purchasing a home.

A recent synthesis report by Beacon Pathways (Berry, 2014) noted similar financial constraints for Pacific families, as well as the difficulty of accessing suitable housing for their larger households.

Situation differs historically for Māori and Pacific peoples

For Māori and Pacific people, the housing tenure situation is complex; we don’t discuss this in full here. However, while both groups are characterised by lower-than-average home-ownership rates, their situations currently and historically are quite different.

Māori, as the indigenous inhabitants of Aotearoa New Zealand, owned much of the North Island in the late 19th century. As late as 1910, Māori owned around 27 percent of the North Island, but this fell to 9 percent by 1939 and was around 4 percent by the beginning of the 21st century.

See Māori land loss, 1860–2000 (also see Coleman et al, 2005).

Since the 1990s, there has been an increase in the quantity of land in Māori ownership, and other assets, partly as a result of Treaty of Waitangi settlements (Coleman et al, 2005).

Māori faced challenges in developing land and housing over the 20th century. Since Māori land is communally owned, they experienced issues with obtaining finance for land development and housing, although some government assistance was available (Boston & Chapple, 2014; Schrader, 2013).

Maori Land Online shows most Māori land is located in rural areas. However, since the mid-20th century, rapid urbanisation has meant that most Māori now live in urban areas and are therefore subject to the effects of rising house prices, particularly in the main metropolitan areas in the 2000s.

In contrast, Pacific peoples have only been present in New Zealand in large numbers since the 1960s. In 1951, the census showed that New Zealand had 4,539 people with one or more Pacific ethnicities. By 1971 there were 31,149 people born in Pacific countries living in New Zealand and 50,434 people of Pacific ethnicities.

Demographics of New Zealand’s Pacific Population (Statistics New Zealand, 2007) notes that people from the Cook Islands, Niue, and Tokelau held New Zealand citizenship and therefore had unrestricted right of entry and settlement in New Zealand. However, people from other Pacific nations, particularly Samoa, Tonga, and Fiji, entered New Zealand through temporary permits, quota schemes, and family reunification policies.

A combination of push and pull factors led to an increase in Pacific migration. In the 1960s, New Zealand had full employment and needed labour, particularly in manufacturing, and welcomed Pacific workers. Climatic factors were also influential. For example, tropical cyclones damaged Tokelau and Niue in the 1960s.

Samoan migrants were the first to arrive in large numbers in the 1950s and they remain the most numerous group today. About half the people with one or more Pacific ethnicities in 2013 identified as Samoan.

Each wave of immigrants arrived and established their own communities and settlement patterns. Some groups settled in close communities, while Walrond (2014) noted that unlike “many other Pacific peoples Niueans did not group together, but dispersed throughout Auckland’s inner suburbs”.

By 2013, almost two-thirds (62.3 percent) of Pacific peoples were born in New Zealand. Figure 1 shows that almost 8 out of 10 Cook Island Maori and Niuean people were born in New Zealand. In contrast, just over 4 of 10 Fijians were born here.

Figure 1
Graph, Percentage of people with Pacific ethnicity born in New Zealand.

Home ownership is likely to be lower for recent migrants, as people take time to build up their assets. In 2013, for example, 11.2 percent of all overseas-born people (aged 30 and over) who had lived in New Zealand for less than a year owned their dwelling. This compared with 70.6 percent of those who had lived in New Zealand for 20 years or more.

While home ownership for Pacific people increased with length of time in New Zealand, it was much lower than for other ethnic groups and did not increase as much over time.

Figure 2
Graph, Individual home ownership by number of years in New Zealand.

While tenure patterns varied for Pacific peoples, they are characterised by lower rates of home ownership than for other migrant groups. We explore possible reasons for lower home-ownership rates in ‘Factors affecting home ownership falls’.

Māori and Pacific settlement patterns

By the time of the 2013 Census, 84.4 percent of Māori lived in urban areas, although this varied by region. Almost half of Northland Māori (20,760 people or 46.2 percent) and just under one-third in Gisborne region (6,024 people or 30.6 percent) lived in rural areas.

In contrast, Pacific people tended to settle in large urban areas, particularly Auckland and Wellington. In 2013, more than 9 in 10 people with Pacific ethnicity (97.1 percent) lived in urban areas – around 8 out of 10 Pacific people were in the metropolitan areas of Auckland, Wellington, or Christchurch.

Figure 3 shows the distribution of Pacific peoples in New Zealand in 2013 while figure 4 looks at growth of the Pacific population in the largest urban areas for 1986–2013.

Figure 4 shows that in both 1986 and 2013, Pacific people were most numerous in the Southern and Central Auckland zones. However, between 2006 and 2013 the largest population increase occurred in Southern Auckland.

Figure 3
Image, Distribution of Pacific people by territorial authority area, 2013 Census.

Figure 4
Graph, people in households in largest urban areas.

In 2013, Māori made up around 15 percent of New Zealand’s population that stated an ethnicity. Before European settlement, most Māori had lived in the North Island, a pattern of population distribution that continues today. Figure 5 shows the largest populations of Māori were in Auckland, Hamilton, and Christchurch in 2013. However, some smaller areas had high proportions of Māori. In Wairoa, Kawerau, and Opotiki districts around 6 out of 10 people identified as Māori.

Figure 5
Image, Distribution of Maori by territorial authority area, 2013 Census.

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