The shift to smaller towns and centres came as covid-19 changed people’s work habits, as well as soaring house prices and living costs in major cities.
This was highlighted in an Infometrics analysis released late last year, which showed 11 out of 67 districts including Horowhenua, Thames-Coromandel and Selwyn all had increases in population growth from internal migration.
Selwyn had the largest inflow of internal migration, with a net contribution of 2100 people. Tauranga City came in second with an inflow of 1900, followed by Waikato District (1200), Waimakariri (1100) and Whāngārei (920).
Infometrics senior economist Brad Olsen says the speed of the movement following last year’s covid lockdown that had come as the biggest surprise to him.
He believed the movement was partly due to people wanting better lifestyle options while working from home or commuting to work and having more affordable housing compared to where they used to live.
The shift could also be in part due to the economic success of the primary sector during the covid pandemic compared to industries based in urban centres.
“With jobs going in those areas, I think there are people who are looking at those options as well – maybe not immediately – but are thinking, if those sectors are going well, perhaps I want to base myself closer to where the action is happening,” he said.
Provincial areas are being put back in the economic driving seat.
It will pose new challenges as well as opportunities for these smaller towns.
“Small rural New Zealand is possibly not so small and rural anymore,” he said.
If communities have grown then more services will need to be provided to support them. It also means communities will no longer be as tight knit as they used to be.
The migration had coincided with rising land values in provincial New Zealand, which showed it was not just cities driving property price increases.
“The price growth across NZ was very broad based. We’re seeing some very strong numbers coming out of nearly every region,” he said.
“It’s not any one area that seems to be going well or not. It’s everywhere that’s steaming ahead.”
Rising house and rental prices could also cause some angst in those already living in those communities. Olsen says it has resulted in an increased need for social housing across the country.
Federated Farmers board member Chris Lewis says in his own district of Pukeatua in Waikato, enrolment in the local school had doubled from 40-60 children in previous years to 103.
“It’s not because there’s more dairy farming or drystock kids,” Lewis said.
It was because the district was expanding with more sections being created or bought for housing.
“There’s been sections in the village that haven’t been sold for years and suddenly there’s been at least five or six houses being built,” he said.
Many of these neighbours’ main source of income was not farming, but were employed in the region.
“The dynamics have changed and it’s been outstanding for the school because they’ve got five or six teachers now and it’s more resourced,” he said.
While it could not be ruled out, Lewis believed it was unlikely to affect the majority of farm employees looking for housing close to the farm they work on because so many farm owners had dedicated staff houses on their farms.
Houses on farms had become extremely valuable assets and had to be charged at market rates in order to offset rising on-farm costs, such as lifts in minimum wages.
“What it does make it challenging for is businesses like tractor drivers. My local one employs 10-15 people and they’ll struggle to find accommodation,” he said.
He says it could also put pressure on farm businesses that rely on seasonal staff as those staff would have to find new accommodation.
What it had done was put upward pressure on housing prices. Another house close to his farm recently sold for three times what it sold for previously.
