It doesn't surprise me that housing affordability in Tauranga is far worse than it was a year ago.

Yesterday we reported the latest Demographia International Housing Affordability Survey rated Tauranga as "severely unaffordable" with a median multiple score of 8.1 - a score which measures the ratio of median incomes to median house prices.

A year ago Tauranga's score was 6.8. Anything more than a score of 3 is classified as unaffordable. The only New Zealand city which was less affordable was Auckland.

We started looking for a house early last year and couldn't keep up with the rate at which house prices were increasing.


We increased what we were willing to pay at every auction but were always outbid, and not by a small amount.

We just couldn't keep up with the market.

According to the report, Tauranga's median household income was also low comparatively. The median, as reported in the study, was $60,400 - that's not only lower than Auckland but lower than Christchurch, Wellington and Hamilton-Waikato.

No wonder so many people are struggling to buy houses when the median price is more than eight times the median household income for a year.

The median is the middle number in the sample meaning that, according to the survey, 50 per cent of the population of the region have a household income less than $60,400. That in itself explains a lot.

Once you pay for rent, food, power, water, petrol and car maintenance, and all the other things that pop up, you are not likely to have much left to save if you are earning the median amount or less.

While increasing house prices and more competition are good for the region, it makes it harder for individuals trying to buy their own home.

Pay has traditionally been lower in Tauranga than in other centres but employers need to realise they are no longer going to be able to get away with paying less if they want to attract and retain good staff.

I am hopeful we will see a change as more companies are established or move to the Bay.