91ÉçÇø

91ÉçÇø forecasts that high-income earners will receive a growing share of total income in 2026-27, rising by 0.10 percentage points to 27.8%. This shift is supported by continued growth in New Zealand's economy, an increase in the median age of the population and elevated asset values. The April 2025 overhaul of New Zealand's Active Investor Plus visa has also made investing in New Zealand more attractive by lowering thresholds and broadening acceptable investments, which continues to support capital inflows from high-net-worth individuals. With capital income concentrated among wealthier households and business confidence remaining historically elevated despite a projected fall in 2026-27, after-tax income is expected to become slightly more concentrated at the top end.Over most of the past five-year period, rising housing prices have boosted the value of housing portfolios for high-income earners, increasing their earning potential from rent or capital gains. The rising value of residential properties in New Zealand has allowed investors to make gains from buying and selling property over the period. Over the past five years, the NZX 50 index has also mostly risen, granting shareholders additional income. Volatile economic conditions and lockdowns during the COVID-19 pandemic restricted the earning potential for some low-income earners, like employees in hospitality, retail and tourism-related industries. These conditions have supported growth in the share of total income received by high-income earners over the past five years.A low cash rate over the three years through 2021-22 supported gains among high-income individuals, as borrowing costs were low, allowing for more leveraged investments. This encouraged high-income individuals to invest more of their earnings in housing and other assets to ensure consistent returns, while lower-income individuals generally lacked sufficient excess savings to invest effectively, widening the gap between low and high earners over the period. Since 2022, the cash rate has largely risen and demand in the housing market has cooled, leading to a significant correction in house prices from their peak and reducing capital gains for many owner-occupiers. Wealthier households, which typically hold more diversified portfolios and can continue to transact in a softer market, have still captured a disproportionate share of remaining capital income as prices adjust. These dynamics have contributed to a steady rise in the share of total income flowing to the top decile. 91ÉçÇø forecasts the share of income received by high-income earners to increase by an annual average rate of 0.14 percentage points over the five years through 2026-27.