Housing market changes and their impact on children

Our Children, Our Choice: Priorities for Policy - Housing market changes and their impact on children

Part Four of the Child Poverty Action Group series: Our children, our choice, focuses on housing. As with other policy areas, the issues are complex and require long-term solutions, which is why CPAG recommends a cross-party agreement on a child-focused policy framework for the future of housing.

Download the full report here: Housing market changes and their impact on children


As a society we could choose do better for our children to make sure they all grow up in a warm, dry, secure house. 

Low income is the principal barrier to access to quality housing. For increasing numbers of families, rising house prices mean they are unlikely to ever be in a position to own a house.  

For families who are renting, there are three main problems:

  • house rents are high and increasing,
  • the quality of the rental properties appears to be substandard and deteriorating,
  • the rental market provides few rights and protections for renters.

Families in their own homes, with or without a mortgage, are likely to be in better health than those who rent their house, either from private or public landlords.

Christchurch and Auckland have been worst affected by rent increases. For the whole of New Zealand, rents have increased by around 11% since 2009, which is around the same as Consumer Price Index inflation. Christchurch rents have increased by 20% to 30% over the past five years, with almost all of this increase since the 2011 earthquakes. In Auckland, rents appear to be rising about 10% faster than incomes, and have increased by 17% in nominal terms between 2009 and 2013, with most of this increase occurring since 2010.

The Household Economic Survey shows Aucklanders on average pay a higher proportion of their incomes on housing costs, at around 19%, compared with other New Zealanders who pay around 16%.  There are wide variations in income and housing fortunes across the income range, between tenures, and across New Zealand.

Nearly 70% of children in poverty are in Housing New Zealand Corporation (HNZC) or private rentals.

  1. Private tenant households are most likely to face the greatest financial stress and vulnerability.
  2. Two local housing markets under particular stress are those of South Auckland and Christchurch East.
  3. The highest concentration of poor children live in HNZC housing, so recent policy changes around the delivery of social housing are highly relevant to the wellbeing of these children.

The increasing cost and affordability of housing has serious consequences. Inadequate housing can adversely affect the health of the occupants, and children seem to be particularly vulnerable to prolonged exposure to poor housing.  Damp housing is related to respiratory conditions in both adults and children. Mould is more likely to grow in damp houses, and has been shown to have a small, but significant respiratory effect on children.  Another consequence is household crowding which increases the risk of infectious diseases. Low income and poorly constructed housing also contribute to fuel poverty, the inability to heat the indoor environment to healthy levels.

Poor housing conditions in infancy and childhood have a cumulative detrimental effect on physical and mental health. Such enduring problems are not confined to children in Auckland and Christchurch. An article in the New Zealand Medical Journal in late 2013 concluded:

Among children admitted to Wellington Hospital there is a high prevalence of exposure to cold, damp and overcrowded houses … Maori and Pacific children and children living in socioeconomically deprived areas are more likely than others to be exposed to these potential risk factors for childhood hospitalisation.  

While the number of social housing units owned or managed by HNZC has fallen slightly, the level of subsidy required to support HNZC has risen much faster than inflation. At the same time the number of new allocations to households requiring housing has fallen, the priority waiting list has grown, and the Crown is extracting dividends from HNZC at higher rates. 

The 2014 Budget signalled the continuation of the Government’s desire to extend support to NGO social housing providers through operating subsidies and a very modest capital grants budget.  The 2013 Budget announced the extension of income related rents subsidies - previously only paid to HNZC - to NGO social housing providers.  The budget for this in the first year was $2.9 million but was expected to grow to $10 million per year within four years.  These modest amounts need to be compared with the $670 million allocated in income related rents to HNZC in 2013/14.

Consideration of the quality of the existing public and private rental housing stock, and the privately owned housing stock, is largely missing from current discussion.  The price of housing reflects location, size, quality, and demand and supply but not necessarily quality.  

The concept of a ‘Housing Warrant of Fitness’ (HWoF) provides an opportunity to ensure low income housing is ‘fit for purpose’ across a wide range of indicators. With cross-party agreement, child-centred standards could underpin the HWoF, including security of tenure, access to public spaces and quality schooling as well as weather-tightness, electrical integrity and security against theft or intrusion.

CPAG has made six recommendations on housing policy which are straightforward, simple and achievable. While the initial cost in money terms may seem large, in the long-run, for our children, they are economically efficient and socially just choices.


 1.       That Government develops a national housing plan which provides forecasts of future housing needs, programmes for addressing these needs and the budgets necessary to complete these programmes.

 2.       That, based on the national housing plan and on the current shortage of social housing, the Government commits to building an additional 1,000 social housing units per year either in the state or non-state sectors, and in areas of high need.

 3.       Prioritise access to social housing for households with children in certain regions, including the Counties-Manukau District Health Board region, on the basis of their exposure to rheumatic fever.

 4.       A housing warrant of fitness for all rental properties be put in place within five years to ensure that all rental properties meet acceptable health and living standards.

 5.       The Government provides adequate subsidies to landlords to insulate their houses as a means of improving the living conditions of tenants.

 6.       The Accommodation Supplement be urgently reviewed with the aim of better integration of housing assistance into overall family income support and with a view to reducing complexity and high abatement rates and to improving housing affordability.


Download the full report here: 

Housing market changes and their impact on children