Tauranga now NZ’s most unaffordable city to buy a home, eighth worst in the world

Tauranga City Council admits it has not kept up with the pace of growth in the city which has been deemed one of the most unaffordable in the world to buy a house.

The annual Demographia International Housing Affordability study shows New Zealand has continued to be one of the most unaffordable countries in the world to buy a home, with the median price more than six times the median annual household income.

Tauranga came in as New Zealand's most unaffordable city when comparing median salaries and house prices, and it's the eighth least affordable city in the world.

Hong Kong was the most unaffordable, followed by Vancouver, Sydney, Melbourne, San Jose, Los Angeles, Auckland and Tauranga.

Councillor Max Mason, chair of the council's Economic Development and Investment Committee, says what they have done in the past has not helped keep up with the pace of growth in Tauranga. 

"We're one of the fastest growing areas in the country and we're struggling to keep up with the pace of growth and deliver everything that needs to support it, especially transport networks," Mr Mason said.

"We need to look at new approaches to managing our growth, ensuring we have sufficient land available for housing and improving transportation networks," he said.

Mr Mason said the council organisation is undergoing a restructure that will "help us focus on the right things". 

"And we are looking at new ways for our organisation, and the other councils in the western Bay of Plenty, to work in partnership with central government.

“Discussions have started and we will be meeting with Minister for Housing and Urban Development and Transport Phil Twyford in February to discuss how we work together, to tackle the challenge of housing in the region moving forward."

The Demographia report’s co-author, Hugh Pavletich, said the findings were a result of government inaction.

"Unfortunately, this has been created, in large measure, by the government just dithering through 2018 in dealing with these issues,” he said.

Mr Pavletich said housing unaffordability was "solvable".

"They just [need to] allow affordable housing to be built. In other words, getting out of the road more than anything on this land supply issue and bringing in proper debt financing for infrastructure."

Mount Maunganui, New Zealand - January 18 2015: Visitors walk along the esplanade in Mount Maunganui. Mount Maunganui is a very popular travel destination in the Bay of Plenty, New Zealand.
Mount Maunganui (file picture). Source: