Is the Kiwi dream changing?
The traditional “Kiwi dream” might be changing for good
Historically, as the wealth of New Zealand families increased, their desire for several key things has grown. A typical progression may have been to buy:
- A family-sized home,
- A nice vehicle,
- Perhaps a boat, and
- A bach or crib.
This combination was sometimes shortened to “the beamer [BMW], the boat, and bach”. In particular it was the purchase of a bach or crib which signified a person had ‘made it’ financially. Baches began to gain popularity in the 1950s as roads improved and the increasing availability of cars allowed for middle-class beach holidays, often to the same beach every year. With yearly return trips being made, baches began to spring up in many family vacation spots. The desire for nothing more than the Kiwi dream has so strongly imprinted on the NZ mindset that it has been academically proposed as one of the reasons for NZ’s lackluster innovation and productivity by international standards. That is to say that once this dream was attained the perception is that Kiwi businessmen and women eased up on business to enjoy life.
What is changing?
Families are changing and so is the Kiwi dream
NZ families are changing:
- Rising numbers of solo parents and single-person households means households can have less disposable income. This might make a bach and even a nice vehicle unattainable.
- Alternatively, this could be offset by many households that have two-parents working fulltime. Though of course, these couples may be more “time poor”.
- Many households remain childless. This may suit those more inclined towards lengthy international travel (once restrictions ease), and less inclined towards more frequent family-orientated holidays at a bach. This might also suit living in townhouses and apartments closer to workplaces and amenities rather than family-sized homes on a plot of land further out in the suburbs.
- Many families are changing their priorities, focusing on short term enjoyment and ‘keeping up with the Jones’s’. Rather than long-term goals such as a bach that seem unattainable.
Bach’s are getting expensive
Bachs or cribs have evolved from something simple and low cost that was often built by the owner beside a beach, river or lake, to a more palatial dwelling more comparable to the family home. These might be clustered in areas of high popularity but are now often many streets back from the water or river front, and are located in a new form of suburbia. These dwellings are built by professional builders and are often purchased or built with a mortgage (debt-funded).
As is the case with most housing in NZ, properties in desirable coastal or lakeside holiday locations are getting expensive too! While this is now a political hot potato, there is little to suggest limited government measures in this area will alleviate affordability.
Beyond the Beamer, the boat, and the bach
A simpler dream for some
For many Kiwi’s, just getting onto the property ladder then repaying a mortgage before retirement is proving enough of a challenge. In addition, some young New Zealanders may increasingly turn to apartments or townhouses rather than traditional family homes.
A different dream for others
For those in more robust financial positions, several options might work a lot better than having many hundreds of thousands of dollars tied up in a holiday home and boat.
- Working from home. Greater use of the internet – NZ has mostly world class internet connections – and working from home (WFM) might mean that professional workers who can relocate to more isolated areas and holiday locations do so permanently or semi-permanently. Of course, this will only be in roles where that is viable.
- Overseas travel. Before covid struck, affordable international airfares and a desire for greater flexibility was already resulting in more New Zealanders than ever opting for frequent overseas holidays, often to exotic locations.
- Flexible Kiwi holiday alternatives. For those that want to holiday in NZ, plentiful Airbnb accommodation is on offer.
The bottom line
The world around is changing quickly, and this is changing many Kiwi families financial and lifestyle goals.
We often come across people who can achieve far more financially than they thought at first. Whatever situation you’re in, it would be our pleasure to assist with your goal-setting and goal achievement. Leave your details below and we will get back in touch within a workday.