Sliding home ownership rates are a "disaster in the making", says the Property Institute.

Home ownership is nudging a new low with the fewest Kiwis living in their own homes in 66 years.

Nationwide 63.2 per cent of people today live in their own homes - the lowest rate since the 61.2 per cent recorded at the 1951 Census - with 33 per cent living in a rental.

Statistics New Zealand Dwelling and Household Estimates data released yesterday showed of the 1.8 million homes, 1.2 million were owner-occupied in December 2016, and 604,900 were renting.


A record high of 73.8 per cent (848,916) was last recorded 26 years ago in 1991 - 10 per cent more than the latest figures. Renters in the same time period made up only about 23 per cent of the total.

Property Institute chief executive Ashley Church said the situation "threatens the fundamentals of what it means to be a Kiwi".

While numerous factors influenced ownership rates, Church singled out the Reserve Bank.

The Reserve Bank's policies had made it "almost impossible for first home buyers to get into their first home and risk locking in a fundamental social change that will affect Kiwis for a generation".

The bank in 2015 introduced loan-to-value ratios that required most home buyers in Auckland to have at least a 20 per cent deposit. These rules were extended to the whole country last September. Property investors need a 40 per cent deposit.

Church said today that the restrictions had "totally missed the mark" and treated "first home buyers as expendable fodder on the altar of a misguided economic and social experiment".

"It isn't just about the value of the house as an asset - it's also about what you can do with that house. Mums and Dads use the equity in their homes to buy businesses, fund further education, fund their retirement and help out their kids. Those options won't be available for Kiwis who aren't able to buy a home and it's a disaster waiting to happen - not just for the individuals affected - but for the economy as a whole".

"There's also the impact on communities, from a generation of renters, who won't have the same ownership stake in the places where they live. That's bad news for our Kiwi culture," he said.