![\"\"](\"https:\/\/exposures.co.nz\/wp-content\/uploads\/2025\/06\/blame-the-system1-974x1024.jpg\")
<\/p>\n<\/p>\n
Homeowners are facing average rates rises of 15% according to data in draft long-term plans across 48 councils, averaging at about $8 more per week* per household.<\/p>\n
LGNZ<\/a> commissioned a report by one of the country\u2019s leading economists, Brad Olsen<\/a>, which starkly illustrates the cost pressures councils are under. It also states that between 2002-2022, the average rates rise was only 5.7% per year, and rates rises averaged 9.8% in 2023.<\/p>\n \u201cCouncils are acutely aware they need to balance the need for investment with affordable increases but the pressure has reached tipping point,\u201d says LGNZ\u2019s Vice-President Mayor Campbell Barry.<\/p>\n New Zealand’s rising rates are primarily due to increasing costs for local councils, including infrastructure upgrades, population growth, and inflation, leading to higher rates to fund essential services and meet community needs.<\/p>\n Here’s a more detailed breakdown:<\/p>\n Infrastructure:<\/strong> Population Growth:<\/strong> Inflation:<\/strong> Rising Construction Costs:<\/strong> Insurance Costs:<\/strong> Debt Servicing:<\/strong> Climate Change:<\/strong> Meeting Increased Demand:<\/strong> Shifting Demands:<\/strong> High Inflation:<\/strong> Reserve Bank’s Role:<\/strong> Alternative Funding Models:<\/strong> Government Support:<\/strong> Drivers behind rates rises across the country laid bare – LGNZ<\/a><\/p>\n The regions hit with the sharpest rates hike | RNZ News<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" New Zealand’s rising rates are primarily due to increasing costs for local councils, including infrastructure upgrades, population growth, and inflation, leading to higher rates to fund essential services and meet community needs. . . . → Read More: The Real Reasons Behind New Zealand’s Rates Increases<\/a><\/span><\/p>\n","protected":false},"author":7410,"featured_media":826,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"episode_type":"audio","audio_file":"","podmotor_file_id":"","podmotor_episode_id":"","cover_image":"","cover_image_id":"","duration":"","filesize":"","filesize_raw":"","date_recorded":"","explicit":"","block":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"Be wary of charlatans' peddling false narratives about rising rates. The real reasons behind Aotearoa's eye watering rates hikes are very different from the spin being spun by coalition aligned fakers.","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[120,122],"tags":[137,138,139,140],"series":[],"class_list":["post-1160","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-election-25","category-news-clippings","tag-lgnz","tag-rates","tag-rates-increases","tag-reports","odd"],"episode_featured_image":false,"episode_player_image":"https:\/\/exposures.co.nz\/wp-content\/plugins\/seriously-simple-podcasting\/assets\/images\/no-album-art.png","download_link":"","player_link":"","audio_player":false,"episode_data":{"playerMode":"dark","subscribeUrls":{"apple_podcasts":{"key":"apple_podcasts","url":"","label":"Apple Podcasts","class":"apple_podcasts","icon":"apple-podcasts.png"},"stitcher":{"key":"stitcher","url":"","label":"Stitcher","class":"stitcher","icon":"stitcher.png"},"google_podcasts":{"key":"google_podcasts","url":"","label":"Google Podcasts","class":"google_podcasts","icon":"google-podcasts.png"},"spotify":{"key":"spotify","url":"","label":"Spotify","class":"spotify","icon":"spotify.png"}},"rssFeedUrl":"https:\/\/exposures.co.nz\/?feed=podcast&podcast_series=exposures-the-blog","embedCode":"1. Increased Costs for Local Councils:<\/h3>\n
\nCouncils face rising costs for maintaining and upgrading existing infrastructure (roads, water, etc.) and building new infrastructure to support growing populations.<\/p>\n
\nGrowing populations, especially in urban areas, require more services and infrastructure, putting pressure on council budgets.<\/p>\n
\nGeneral price increases (inflation) affect the cost of everything councils purchase, from materials to services.<\/p>\n2. Specific Factors Contributing to Rate Increases:<\/h3>\n
\nThe cost of building and construction materials has increased significantly, impacting infrastructure projects.<\/p>\n
\nInsurance premiums for council assets and services have also risen, contributing to higher expenses.<\/p>\n
\nCouncils may need to borrow money for infrastructure projects, and rising interest rates increase the cost of servicing that debt.<\/p>\n
\nAdapting to climate change and addressing natural hazards (e.g., coastal erosion, extreme weather events) requires significant investment.<\/p>\n
\nCouncils are facing increased demand for services due to population growth, tourism, and other factors.<\/p>\n
\nSome communities have changing needs (e.g., new housing developments, increased demand for certain services) that require new or upgraded infrastructure and services.<\/p>\n3. The Broader Economic Context:<\/h3>\n
\nHigh inflation, both globally and in New Zealand, has a significant impact on council budgets, as the cost of everything they purchase increases.<\/p>\n
\nThe Reserve Bank of New Zealand may raise interest rates to curb inflation, which can also increase the cost of borrowing for councils.<\/p>\n4. Potential Solutions:<\/h3>\n
\nSome propose exploring alternative funding sources for councils, such as levies on tourists or developers, or sharing GST revenue from new builds.<\/p>\n
\nSome argue that central government needs to provide more financial support to local councils or review the funding model for local government.<\/p>\nFurther reading:<\/h3>\n
The Real Reasons Behind New Zealand’s Rates Increases<\/a><\/blockquote>