$189,000 a year not enough for Wellington mayor to live on
Wellington’s mayor is struggling to make ends meet with a $189,799 salary – is this not enough to live on in the capital?
Mayor Tory Whanau has opted to sell her car (she declined to say which make and model) and walk to work to help pay the bills due to growing economic pressure, despite earning more than $189,000 per annum.
The mayor’s annual salary increased 3.7% after a pay rise in July. She was also a Lotto winner in 2002, pocketing $1.4 million and recently moved into a new townhouse in Mt Cook that she purchased off the plans.
So is $189,000 enough money to meet basic needs these days in the capital? The data says yes.
According to Infometrics Regional Economic Profile, those in Wellington City had a mean household income of $165,974 in March, which was a $7727 increase on the year before.
This was more than $30,000 greater than the New Zealand mean household income, which was $132,538.
The data also showed in Wellington City the average house value was 6.2 times its average household income in 2024, more affordable than the national level of 7.0.
In Wellington City, 43.9% of the average household income would be needed to service a 20 year mortgage on the average house value, with a 20% deposit at average 2-year fixed interest rates in 2024. This was lower than the New Zealand average (49.5%).
“To put things into a little more context, using a 6.5%pa mortgage rate, and the latest average house value for Wellington for June 2024, the average Wellington house ($1.029m) with a 20% deposit would cost $2566 in mortgage repayments a fortnight, or $66,721 a year,“Infometrics director Brad Olsen said.
“That’s around 40% of the average household income for Wellington City, of $166k in 2024.”
However, rates were also increasing in Wellington, with some homeowners facing a hefty increase.
The Wellington City Council long-term plan included an 18.5% rise in rates for 2024/25, following a previous increase of 13% the year prior.
Council data showed median rates varied between $3276 and $8000 in the Wellington urban area.
Those under the Greater Wellington Regional Council would experience an increase of 25%, with the average residential property value in creasing to $1178.
Overall, Wellington City households would be forking out about 21% more for rates in the coming year – at least $1000 more for many households.
Data from the 2022 Quality of Life Survey, produced by Nielsen, showed 26% of respondents in Wellington said they had just had enough money to meet their everyday needs for things such as accommodation, food, clothing and other necessities, while 12% did not have enough money.
In the greater Wellington area, 29% could only just meet their needs, while 13% did not have enough.
When asked about the home respondents currently live in and how much they agree or disagree that housing costs, such as rent, mortgage rates and house insurance were affordable, 29% in Wellington disagreed and 18% strongly disagreed.
In greater Wellington, 27% disagreed and 14% strongly agreed.
“Ultimately, everyone’s situation will be different, on a range of factors like their house, their mortgage terms, their spending, and a range of other factors,” Olsen said.
“That’s a personal choice for everyone, and it’s normal and in fact very worthwhile looking at expenses when household costs rise as they have in recent years as inflation has spiked higher and interest rates have increased – Wellington’s a fairly compact city, and a car definitely isn’t a necessity for every household.
“An individual income of $189k is above the average combined household income in Wellington, and just more than double the average personal earnings in Wellington City in 2023.
“So a personal income of $189k is more than most in Wellington have to live on – everyone’s circumstances will be different, but $189k in Wellington is well into the upper half of what people get paid in Wellington, and should be enough to live on.”