The Cost of Living in New Zealand

Many migrants to New Zealand from the UK are surprised to find that the cost of living is far higher than they expected - especially when they start earning dollars.

It is difficult to make a direct comparison between incomes and household expenses between New Zealand and the UK – there is the exchange rate to take into account, different rates of tax and income support, as well as different lifestyles – and both countries use quite different methods for calculating income and expenditure. However, in purely numerical terms:

New Zealand Household Income:

Figures from Statistics New Zealand suggest that the average NZ household income in the June 2009 quarter was just under $79,000, or $1,517 per week. Please note that this figure includes income from government benefits.

UK Household Income:

In 2008/2009, the average gross household income was £30,500 per year, or £586 per week. Please note that this figure does not include income from government benefits. 

New Zealand Household Expenditure:

UK Household Spending:

A survey of UK household spending from 2008 released by National Statistics in the UK shows average household expenditure of around £24,500 per year, or around £471 a week. Please note that the “Other” Category for the UK includes expenses such as mortgage interest payments, council tax, domestic rates, holiday spending, cash gifts and charitable donations.

So, with a few small differences, New Zealand and UK households spend roughly the same proportion of their incomes on the same things.

High Costs, Low Incomes

Anecdotally speaking, some emigrants from the UK report that they feel very financially stretched in New Zealand, while but others either satisfied with their incomes or feel happy that the lifestyle in New Zealand compensates for any income disparity. It is fair to say that the cost of living in New Zealand is probably higher than you expect, and that you may have less disposable income than you are used to when you emigrate to New Zealand – and at least some of this is down to the relatively high cost of goods and services in New Zealand.

So why are things just as expensive, or more so, in New Zealand?

NZ is a remote, relatively small market, so imported goods especially may be more costly. For the same reasons, you may not find the range of goods you are used to.It probably takes the average migrant or returning Kiwi around a couple of years to stop automatically converting prices from dollars to pounds, and looking for things in the shops that just aren't there, but you'll be relieved to hear that some things do compare favourably! There is much ongoing debate in New Zealand as to why incomes in New Zealand aren’t that high, even when compared to a local economy such as Australia. You will hear a lot of discussion in NZ about whether workers are better off in Australia, which has higher wages – reportedly by around 40%. To find out more about New Zealand incomes compared to UK incomes, please see our separate article on New Zealand Salaries.

The Standard of Living in New Zealand

But the fact remains that a very good standard of living is very achievable in New Zealand, far more so than most parts of the UK, especially for a family. For example, it probably won't take you long to drive to a pleasant beach, which is a great day out for the price of an ice cream. Many regions have festivals and fun days, and family entry to attractions is often around $25. You'll find attractions and events less crowded and easier to get to, which makes them a lot more enjoyable. Check here for a few of our favourite days out in and around Christchurch. 

The vast majority of migrants to New Zealand come here to improve their lifestyle, and our experience with hundreds of UK migrants over the past 8 years suggests that most of them achieve this. Take a look at the results from the 2008 NZ Immigration Department Skilled Migrant Survey to see how 230 families from the UK and Ireland felt after their first year in New Zealand.

You are in quite a strong financial position as a UK migrant to New Zealand; you may be able to take the equity in your UK home and pay off a large chunk of a comparable home in New Zealand. You could well save on school fees by moving into an area with good state schools - which you may even be able to walk to. Either of these steps may mean that you are able to live on one income while your children are young, buy a nicer house, and/or take a lower paid, less stressful job.

Remember that your last few months in the UK and your first few months in New Zealand will be very expensive – on the UK side for example you may be decorating a property to rent or sell, paying for shipping and insurance, and paying for air fares and visa fees; once in NZ, you will need to buy a car, pay for your initial accommodation, and perhaps pay for uniforms and other education expenses. It will make life much easier if you can access some savings over this time. For more information, please see our article on how much it costs to emigrate to New Zealand.

Please see our article on Food and Drink to discover what is available in New Zealand and how much you'll pay for it. We have even compared a trolley load of shopping in NZ and the UK for you.

If you are trying to work out what to ship to New Zealand, please see our articles on What to Bring with You and Shopping in New Zealand. You'll find plenty of links and advice to help you to figure out what household goods cost here, which may also help you when working out how much marine cargo insurance you'll need.

Please contact us if you have any questions about the financial side of life in New Zealand, and don't forget to order your free copy of our comprehensive New Zealand Guide.