135,000 Families FLEE Auckland - Hamilton Housing Affordability CRUSHED!

Added: 2026-05-14

[00:00:00]135,000 people walked away from Auckland and headed for what looked like better ground. The largest wave went to Waikato. For those already living in Hamilton, the arrival wasn't subtle.

[00:00:12]House prices surged, rents climbed, and affordable housing disappeared faster than it could be replaced. By late 2021, first home buyers were priced out, rental families were squeezed into motels, and the public housing waitlist had nearly tripled in 3 years. More than 135,000 Aucklanders left the city for other regions between 2018 and 2023. Stats NZ confirmed Waikato as the top destination, followed by Northland and Canterbury. About 85,000 people moved to Auckland during that same period, mostly from Waikato and Wellington, but the numbers still left Auckland with a net loss of roughly 50,000 people over 5 years. For Hamilton, that incoming pressure arrived at the worst time. The city was experiencing what the Treasury later called growth for the first time in decades, and supply hadn't responded.

[00:01:05]What followed was a price surge that locked out the very people migration was supposed to help. In the year to June 2023, Auckland's net internal migration loss hit 11,200 people. By June 2025, that outflow had dropped 70% to 3,200, but the damage in Hamilton was already done. Between March 2002 and June 2021, house prices in the Waikato region rose 372%.

[00:01:33]Rents climbed 114% and section prices went up 405%, 658% in Hamilton City alone. These weren't gradual shifts spread evenly over two decades. The steepest climb happened between 2018 and 2021, with the second half of 2021 seeing what Hamilton City Council later described as exponential growth with rapid increases. By October 2021, the Waikato median price had risen 23.6% year-on-year to $805,000, up from $651,000 the previous October. One month later, it hit $855,000, a 27.6% annual increase. Hamilton City's median reached $881,000, a record high. The REINZ House Price Index for Waikato showed a 33.2% annual increase, the second highest in New Zealand. REINZ chief executive Jen Baird noted at the time that it was the first occasion all 12 regions had sustained annual increases above 20% for seven consecutive months. Average house values in Hamilton rose 24.3% in 2021 alone, then another 19.1% in 2022. For Aucklanders escaping a $1.3 million median, Hamilton's $881,000 looked achievable. That $419,000 gap represented breathing room, or at least it seemed that way. But for people already living in Hamilton on Hamilton incomes, $881,000 was unaffordable. First-time buyers who might have stretched to $600,000 or $650,000 were now facing a market that had moved 40% beyond their reach in under three years. Renters weren't spared. Between 2010 and 2021, the average rent for a two-bedroom apartment climbed 43%, outpacing the 23% rise in inflation. From April 2020 to April 2024, the median rent increased $90 per week, a 4.57% annual rise. Rental families who had been managing on tight budgets found themselves squeezed further each year with no relief in sight. The rental supply couldn't keep up. Hamilton's renter population grew to between 2016 and 2021, five times faster than the 2.3% growth in owner households. Only 18% of those new renters found space in newly built primary rental housing, compared to a 28% provincial average. The rest had to compete for existing stock, driving prices higher. The city lost 4,950 rental units priced below $750 per month during that period. Units considered affordable for households earning $30,000 or less annually. By 2021, Hamilton faced a shortfall of nearly 8,000 units for residents in that income bracket. The consequences showed up in the public housing register. In December 2018, 693 households across Hamilton, Waikato, and Waipa districts were waiting for public housing. By December 2021, that number had nearly tripled to 2,036 households.

[00:04:48]The Treasury noted that Hamilton had more people per capita on the public housing register than the rest of New Zealand, and more families living in motels. In November 2021, at the national peak, 4,983 households were living in emergency housing, including thousands of children. By December 2023, Hamilton alone had 507 households in emergency motels, with 516 children living in those conditions. These weren't temporary stays lasting a few nights.

[00:05:19]Families were spending weeks, sometimes months, in motel rooms with no kitchen, limited space, and no certainty about when they would find permanent housing.

[00:05:29]Thomas Gibbons, a trustee with the Waikato Housing Initiative, said it plainly in January 2025, "Housing affordability remained a critical issue.

[00:05:39]Over the preceding years, Hamilton had delivered on housing supply in terms of numbers, but hadn't delivered in affordable homes. Motels weren't a sustainable solution for emergency housing, especially for families. The negative community, social, and economic impacts from widespread use of emergency housing motels had been extensive, and those families deserve better. The Treasury's August 2022 assessment offered an explanation for how prices had climbed so far, so fast. Due to restrictions on the supply of land, the global decline in interest rates over the past 20 years have been capitalized into land values, explaining most of the rise in house prices. If land supply had been more flexible, falling interest rates would have sparked a stronger housing supply response, meaning rents and prices would have risen by less. In many regional centers experiencing growth for the first time in decades, supply simply had not responded, leading to sharp increases in prices, rents, and housing stress. For Māori in the Waikato, this worsening affordability occurred against a backdrop of historic land loss through confiscation and war, or raupatu. Because Māori made up a larger proportion of renters and aspirant first home buyers, they bore more of the impact from the price surge.

[00:06:59]The Treasury report noted that Māori own less land, fewer owned their homes, and they had less intergenerational wealth to draw on when trying to enter the housing market. The market peaked in November 2021 and then reversed. House prices in Hamilton fell 17.24% before bottoming out in May 2023. As of March 2026, prices remain 15.28% below the peak. The average price now sits around $790,000, down 1.14% year-on-year. Auckland's median dropped from $1.3 million to around $1.04 million, still well above Hamilton, but no longer creating the same migration pressure.

[00:07:41]The $419,000 gap that had driven so many people south had narrowed and the financial incentive to move weakened.

[00:07:49]The exodus slowed. The year to June 2025 internal migration loss from Auckland dropped to 3,200, a 70% decline from the 11,200 recorded in 2023. People were no longer fleeing Auckland in the same numbers, but Hamilton was left dealing with the consequences of the surge that had already occurred. Emergency housing numbers in Hamilton have improved. By November 2024, the 507 households in motels had fallen to 144 and the number of children in emergency housing dropped from 516 to 165.

[00:08:25]Hamilton West MP Tama Potaka described the reduction as dramatic. Though housing advocates noted the numbers remain substantial and the underlying affordability crisis persisted. The improvement reflected better systems for moving people out of motels and into permanent housing, not a return to affordable rents or house prices.

[00:08:46]Hamilton's population continues to grow reaching 192,100 in 2025, a 1.4% annual increase that made it New Zealand's fastest growing city. That growth now comes from international migration, up 1,900 and natural increase, up 1,500 with around 800 people leaving for other parts of New Zealand. The internal migration wave from Auckland has receded, but the effects remain embedded in the market. Rents are still climbing.

[00:09:17]Between February 2022 and February 2026, the median rent rose $60 per week, a 2.87% annual increase. The rental market remains tight with occupancy rates at 99% though that figure has eased slightly from the 99.8% peak earlier in 2025. Waikato real estate noted in December 2025 that current rent increases were lower than the $30 per week jumps seen 2 years earlier. But landlord costs for rates, insurance, and maintenance continued to rise. Tenants now have more choice than they did in 2021, but the gap between supply and demand remains narrow, and rents remain high relative to what most households can comfortably afford. First home buyers are still active in the $650,000 to $750,000 QV Hamilton registered valuer Marshall were noted in December 2025 that the recent easing in interest rates had prompted renewed interest from investors and improved affordability for first home buyers. Homes in affluent areas priced above $1 million are taking longer to sell, suggesting the top end of the market has softened while entry-level properties still face competition. The buyers who were priced out in 2021 are finding the market more accessible, but they are still facing prices well above where they would have been without the migration search. In the year to September 2025, New Zealand's net international migration gain dropped to 12,400, down from a peak of 130,900 in the year to February 2024. Population growth slowed to 0.7% matching the OECD average. In the 12 months to September 2025, 72,700 New Zealand citizens left the country, resulting in a net loss of 46,400 people, the highest outflow since the global financial crisis in 2011 and 2012. Distinguished Professor Paul Spoonley from Massey University noted that population growth is now confined to regions with major cities, Auckland, Waikato, and Canterbury, while Wellington and Taranaki are experiencing stagnation and Nelson, Marlborough, Gisborne, and Hawke's Bay have seen population decline. Hamilton's market has steadied, but not recovered to pre-boom affordability. The average house value remains 13.7% below the January 2022 national peak.

[00:11:42]Prices have risen 2.37% since bottoming out in May 2023. A modest gain that suggests stabilization rather than another surge. Inventory levels have increased, giving buyers more time to compare options, but the supply of affordable housing has not been rebuilt, especially rentals below $750 per month that were lost during the 2016 to 2021 period. The 135,000 people who left Auckland between 2018 and 2023 were looking for relief. Many found it, at least temporarily, in lower house prices and more space. But that migration collided with a housing system already under strain. In a region where land supply was restricted, construction couldn't keep pace, and the rental market was eroding faster than it could be replaced. The result was a price shock that priced out the people who were already there. Prices are down from the peak, but still well above what many households can afford. A first home buyer household earning the median income would need to save for years to meet a deposit on a $790,000 home, and servicing the mortgage would consume a large share of their take-home pay. Renters face a similar squeeze. The median rent in Hamilton is now $560 per week. For a household earning $30,000 a year, that's unaffordable. For a household earning $50,000, it's still a stretch. Emergency housing numbers have dropped, but hundreds of families are still living in motels. The public housing waitlist is lower than it was in 2021, but the structural shortage remains. The exodus from Auckland has slowed, but the affordability crisis it helped accelerate is still working through the system. For first home buyers, renters, and families waiting for public housing, the question is whether supply can catch up with demand before the next wave of migration, international or domestic, hits the city again. Thanks for watching. I'll see you in the next report.