Do Gen Z Really Have It Harder? We Run The Numbers

In the 1980s, the average house price in New Zealand was $40,000, while the average household income was $15,000. That gave Boomers a house price to income ratio of 2.7 to 1. By comparison, in 2025, the median house price is $750,000 and the median household income is $97,000—a staggering 7.7 to 1 ratio.

That means Gen Z buyers are more than three times worse off in terms of housing affordability. In the UK, it now takes up to 25 to 30 years to save a 20% deposit on an average income—and New Zealand isn’t far behind. Over the past 45 years, house prices here have grown four times faster than incomes.

While house prices have risen sharply, so has the debt to income ratio—a key metric that paints the clearest picture of who has it harder. In the 1980s, Boomers could buy a home with a modest loan size. With a 20% deposit, the average mortgage was around $32,000.

Today, Gen Z faces an average loan size of $600,000. At 6.5% interest, that’s a $3,792 monthly repayment compared to the $468 monthly repayment Boomers had at 17.5% interest. In the 1980s, mortgage payments made up around 46% of household income. In 2025, that figure is closer to 56%.

Everyday expenses have jumped significantly too:

• Petrol: $0.50 per litre (1980s) vs $2.65+ (2025)

• Cheese: under $2 per block vs $10

• Rent: $50 per week vs $640

• Power: $0.15 per kilowatt vs $0.53

• Bread: $0.60 a loaf vs $4–$6

• Milk: $0.25 per pint vs $3+ per litre

• Cigarettes: $1.08 per pack vs $35+

It wasn’t just housing that was cheaper—nearly everything was. One man in the 1980s, a university lab technician, owned a beachside home. Today, that same role would struggle to secure a mortgage at all.

The primary reasons discussed? Leverage and tax advantages. Property became a highly attractive investment asset because buyers could borrow against it, get tax benefits, and pay no capital gains tax. That made it easier for those already in the market to build wealth—and harder for newcomers to enter.

Despite the uphill battle, the idea that Gen Z has “given up” doesn’t match reality. Most first home buyers now get some form of help from their parents—whether that’s a cash gift, equity security, or early inheritance. And many Gen Zers are highly aware of their finances, cutting back on spending and making smarter financial decisions.

• House prices have risen far faster than incomes over the past 45 years.

• The current house price to income ratio is 7.7:1—nearly triple that of the 1980s.

• Gen Z buyers now need significantly larger loans, with repayments taking up 56% of income vs 46% for Boomers.

• Everyday living costs—from petrol to rent—have dramatically increased.

• Boomers benefited from lower house prices and more favourable tax conditions.

• Despite challenges, Gen Z is financially savvy and focused on what’s within their control.

Thinking of buying your first home? The team at Lighthouse Financial is here to help. With smarter mortgage advice and tailored strategies, we’ll help you get ahead—even when the odds seem stacked against you., get in touch to book a free consultation.

If you’d like to learn more, check out these other episodes below.