With falling property values slashing $91.1bn off the worth of Kiwis in the first nine months of 2022
New Zealanders saw their household net worth fall by $56.8 billion, or 2.5%, in the September quarter, following a similar decline in the March and June quarters, according to new Stats NZ data.
“In the first nine months of 2022, household net worth fell $179.4 billion, a decline of 7.4%,” said Paul Pascoe, national accounts institutional sector insights senior manager.
The 7.4% fall in Kiwis’ net worth in the first nine months of 2022 was mainly driven by a $91.1bn drop in owner-occupied properties as well as by a $78.6bn fall in financial assets, including shares and investment funds. Household debts also increased $9.5bn.
These changes meant that the $2,250bn household net worth as of September was now just above the $2,237bn recorded in June 2021.
The 2.5% fall in household net worth in the September quarter was mainly driven by the decline in residential property valuations. Accounting for $41.6bn, or 73.2%, of the decline since the June quarter was the fall in household owner-occupied property assets.
According to Stats NZ, the falling property values also drove a 1%, or $12.7bn, fall in household’s financial assets. Rental property owned by households is recorded within equity assets (property valuation less any mortgage held) as a financial asset.
This fall in equity assets was partly offset by a continuing rise in currency and deposits held by households, which was up $2.6 bn (1.1%). In addition, households’ insurance and pension assets marginally rose following drops in the previous two quarters.
Household loan liabilities, which are composed of household mortgages, and consumer and student loans, continue to rise, up $2.5bn (0.9%) this quarter. The rate of increase in household debt, meanwhile, has been easing since the December 2021 quarter.
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