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Citizens of the New Zealand and the UK are leaving in numbers not seen in a century.
UK government data recorded that 87,000 British nationals aged 16 to 24-year-old left, as did 87,000 25 to 34-year-olds, over the period of March 2024 to March 2025. Between June and June, the figures are more staggering—the single largest exodus of residents in a century; amounting to approximately 693,000 individuals, not all of whom are nationals.
New Zealand is experiencing a potentially bigger crisis. Smaller populations, a weaker currency, and more limited job opportunities could be behind the record numbers of emigrations out of New Zealand between 2023 and 2024. 69,100 left in the year-long period leading up to February 2025, an increase of 3% over the same period starting 24 months prior.
Between July of 2024 and 2025, 73,400 New Zealanders left, compared with 25,800 returning home to live, according to Stats NZ.
2024 year saw the biggest net loss of New Zealand citizens of any calendar year on record. While many were those aged 20-29, which may be cultural in nature as a year’s-long backpacking trip in Australia is something of a tradition for young Kiwis, they were followed by an unprecedented amount of retirees, and those aged 30-39 and their children.
Emigration—people leaving a country—is a difficult phenomenon to ascribe guilt or cause on; people emigrate for many reasons. In the case of New Zealand, it may be more straightforwardly economic—prospects are low, but The Independent spoke to young people leaving for other reasons too such as to escape the UK climate—both meteorically and politically. Crime, housing costs and availability, and tax rates are all cited as factors for emigration.
“I was paying tens of thousands of pounds in tax, and then your phone ends up getting stolen out of your hand in the street,” said 24-year-old London-resident Ray Amjad, who was employed in a lucrative graduate position when he spoke to The Independent. “What am I paying all that tax for?”
Weeks leading up to the most recent UK budget proposal, construction and project management platform Morta published an analysis of data traffic that found there was a 342% increase in online searches for “moving to Dubai,” across British servers. Along with better year ’round weather, Dubai has miniscule tax rates, which may play a larger role than is possible to record, as survey respondents, even when acting anonymously, may conceal motives that appear base, such as tax avoidance.
New Zealand generally ranks very positively for business freedom, start-up costs, overall economic freedom, consumer confidence, regulatory environment as a facilitator of growth and activity on major world economic research indices, but competitiveness, overregulation, sky-high housing costs along with a weak job market were all cited by a bevy of emigrants leaving New Zealand for other nations interviewed by The Guardian. Like the UK, the departing Kiwis were quick to also mention government faults: failing social welfare programs and lack of real progress.
Of those large governments, both are within one percentage point of having net expenditures at 43% of the national GDP, compared to Australia’s 37%, and indeed the Heritage Foundation’s Index of Economic Freedom ranked New Zealand within the bottom half of nations for government spending, and much lower than Australia for tax burden. Australia seemed to be where many from both Britain and New Zealand were off to, with those interviewed in both English papers reporting salaries there being higher, jobs more available, costs lower, and taxes less burdensome.
With several decades of economics and finance experience, particularly in investment banking and corporate advising that included a 15-year stint with Credit Suisse both in Sydney and London, Rowan Parchi spoke with WaL about the complexity with how even these industrialized and robustly functioning Western democracies can see conditions of prosperity decline so drastically as to leave its citizens no other option but to pull up stakes.
“Australia’s a nice place to live, the weather’s great, Brits love it,” Parchi told us amid a 30-minute interview.
“But what’s on the other side of that equation, what’s going on in Britain? Crime rising, political issues, I’d say, are getting extremely heated, immigration has caused huge demographic changes. Just a whole host of problems going on—and taxes are very high. It doesn’t look like there’s some big Thatcher movement going on.”
“I can speak to countless Brits that I now that are trying to get outta’ there, to Florida, to Australia”.
A rite gone wrong
“Australia and New Zealand are very isolated, just geographically. However, because of that distance, a very typical thing is for Australians and New Zealanders to travel,” historically to Europe, the UK, and more recently the US and Asia, “it’s almost like a rite of passage”.
“Every year, typically a large number of New Zealanders leave, but there’s also a large number that are returning. And the same happens with Australia. The difference is that with Australia, while there’s a decent amount to come back to, New Zealand is just that much more limited… What’s unusual (now) is the net movement, much less are coming back”.
In a typical year, says Parchi, tens of thousands of New Zealanders will return from their travels, such that the net loss of residents is just ten to twenty thousand mostly very young people. What’s changed he says, is that now there are far fewer returning, and according to the reporting beat at The Guardian, it’s also people in their 30s, sometimes late 30s, with children.
“It’s the very high cost of living, it’s housing shortages and therefore housing costs, it’s low wages… it’s broader, limited economic opportunities, and then part of that is the remoteness of the country and the career path options,” Parchi said. “Some of that’s new, some of that’s always been the case, but the key thing is that historically, I think about 60 to 70% of New Zealanders went to Australia—it’s an obvious place to go—but recently it’s more like 70% to 90%. So the important thing then to consider is that how does New Zealand compare with Australia?”
“They suffer very similar problems,” he interjects, adding that it’s just a lesser degree in Australia, particularly because the country doesn’t really suffer from low wages.
“Australia is just that much bigger, there’s just that much more industry, and with New Zealand you’re looking at just a couple of primary industries, and then a little bit of a service sector in the cities, and then it really drops off a cliff. So career path is much more limited”.
Inflation as a rule
New Zealand has given the world a lot, but for all the popularity of The Lord of the Rings, its most enduring modern contribution to the world may be the Bank of NZ’s 1989 decision to begin a monetary policy that the money supply should increase 2% every year—something found now in virtually every G20 economy, including the UK and US.
“It was the world’s first modern inflation targeting system,” Parchi described. “Between 1989 and 1990, the central bank’s mandate was between 1-3% inflation with an emphasis on a 2% target, before eventually adopting a second mandate in 2018, not unlike the US Federal Reserve, of maximum sustainable employment”.
“Throughout this period, cheap credit and rising leverage pushed up asset prices especially housing. The same factor actually played out in Australia”.
The reality is, says Parchi, is that credit expansion, monetary creation, and liquidity pumping, went on continuously throughout this period, which in the US led to what’s been described as a “hollowing out” of the working class, who held few assets, while the wealthiest individuals saw their substantial hard and liquid assets increase in value 2% or often more every year. In New Zealand, nowhere did this phenomenon concentrate more than in housing.
The depreciation of the New Zealand dollar is a really important factor to understanding the country’s struggles in keeping housing affordable. Even as housing cost remains extremely high across much of the G20 countries, in New Zealand it’s proving to be unsustainable. With an economy based on exporting agriculture, the NZD has a floating exchange rate that allows it to survive overexposure to the prices of the commodities it exports—dairy, beef, wood and wood products, etc.
“The fact that their currency fluctuates around with the prices of commodities, it insulates their economy to a certain extent,” Parchi says. “It’s a good thing. It dampens the impact of those fluctuations”.
International exchange rates—such as the NZD to the Euro for example—will be determined according either to the ratio in the value of the commodities and/or services aiming to be traded, or to an anticipation in the movement in the prices of domestic goods. If the government were to fix an exchange rate between the NZD and Euro that didn’t reflect the overall market prices for a New Zealand commodity available elsewhere, it would instantly and almost invariably cause the market exchange to collapse: no one would pay the higher price for the NZD in order to buy goods priced in NZD when they could take their Euro and buy a currency that was allowed to adjust to the price of the commodity being exchanged.
However, because New Zealand has little domestic industry in the form of manufacturing, energy extraction, or construction inputs, devaluations—such as one of 20% that took place in 2021-22—have a much faster pass-through—in other words, that devaluation showed up immediately in asset prices rather than in goods—in other words, housing.
Parchi chalks up the devaluation to a large current account deficit in the country when it, like most other countries, was creating massive amounts of new money to pay for COVID-19-era economic stimulus, to the fact that the US Federal Reserve was tightening faster than New Zealand’s central bank was, and to weak Chinese demand for Kiwi goods.
But housing, according to many of the emigrants speaking with major newspapers, is the real headache. Australia and New Zealand home mortgages are very rarely fixed, but often float, making it extremely sensitive to the short-end of the interest yield curve.
“If New Zealand raises the overnight rate, it has a quick effect on the economy because everyone’s mortgage costs instantly go up. The nation is really indebted, huge amount of mortgage debt, so it really impacts people’s disposable income”.
Housing prices were already hypothesized as being unsustainably high in 2014. By then the home ownership rate in New Zealand had already collapsed from 76% to 63%, and institutional home buying made up 45% of all home purchases; first-timers a mere 19%. Contrast this to the US, where housing prices are nothing to sniff at, but where even the most securitized housing markets see only around 4% institutional ownership.
“There is no easy fix to New Zealand’s overvalued housing market,” said Shamubeel Eaqub, principal economist at the NZ Institute of Economic Research, to the NZ Daily Herald in 2014, a prognosis that has proven to be a reality as stubborn as the valuations. WaL
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