Mortgage payment amount

Hi all, welcome to the 2018 Census discussion on Mortgage payment amount. I’m Chris from Statistics New Zealand, and I will be facilitating this discussion. I look forward to hearing what you all have to say over the coming weeks.

Yes, we do need to collect info on mortgage payments. We have a massive problem with housing in NZ at present, and so we need factual data to base the discussion on. Size of house and size of mortgage are crucial parts of that discussion.

Thanks for your thought @guymarriage. Do you have any thoughts on whether just having information for total amount paid fortnightly or monthly is useful? Or is more detailed information required (e.g. principle paid and interest paid)?

I've got a mortgage, but it isn't separated out into principle and interest - its just a single enormous lump. So all i could tell you is the repayment amount and frequency. I could also look up the amount of years left to go, but that might be a bit too much of a hassle for many.
What I'd be more interested in knowing, is the amount of owned vs rental properties, and empty vs occupied. There's an evident systemic failure in the housing market, in many markets round the world, but particularly in Auckland at present, and nothing to do with the RMA despite what Nick Smith says. Seeing as the National Government refuses to collect data on it, then if Stats can find out how many houses are owned by overseas owners, and how many by domestic, etc, would be a highly useful exercise, i would have thought....

Housing affordability is a big focus of my work, but I don't think that collecting mortgage payment amount in the census would help understand the issue.

Household mortgage repayments can already be taken directly from the HES or inferred from Reserve Bank data on interest rates and house price data from QV or REINZ. This can be mated to incomes from the HES for a more up-to-date view of affordability than the 5-year census can provide. This approach also means that the impact of interest rate and house price changes can be understood separately - if you want to tackle an issue it is important to understand the 'why', so just understanding how bad/big the issue is won't necessarily help in fixing it.

As touched on above, principal or interest only is a big factor in payment affordability, but it is difficult to know if people are (say) on interest-only repayments due to budgetary constraints, or a conscious choice in structuring their finances (e.g. tax advantages). Given this issue, I'm not sure that information on mortgage repayment amount would be useful in understanding housing affordability, even if there was a tick box on principal + interest versus interest only.

Currently the main information gap around housing affordability is at a subnational level. I agree that census information alone would not give enough of a nuanced picture to understand housing affordability but could supply important supplementary information to enable small area estimation of affordability using the Household Economic Survey.

There are significant limitations with using HES data, even at a regional level, due to high sample error rates for the survey income data. For example, the sample error for HES income for the Manawatu-Wanganui region is 7.3%. This adds significant instability when trying to estimate housing affordability and changes over time. This also limits the usefulness of regional comparisons of housing affordability.

Outside of my work at the City Council I work with people in the financial teaching area and few households would have ready access to data on how much interest and principal they have paid off on an annual basis.