Property prices have been falling steadily in many areas. Photo: 123rf
Households have been saving more but the slide in property prices has further eroded their wealth.
Stats NZ data showed savings just outpaced spending in the three months ended December, but net worth - the difference between assets and liabilities - fell for a fourth consecutive quarter.
The drop in net worth was $10.3 billion, a fall of 0.5 percent on the previous quarter.
"The four quarters of decline in household net worth have resulted in an annual fall of $176 billion, or 7.3 percent, from the peak in December 2021," Stats NZ senior manager Paul Pascoe said.
The total net worth of households in December was $2251b.
A $12.3b fall in house values was a major driver of the fall, but rising interest rates helped to lift returns from investments and term deposits.
Meanwhile, households saved slightly more in the final quarter of the year than they spent resulting in an increase in net disposable income.
"The total disposable income of New Zealand households increased at a slightly higher pace than the rise in living costs," Pascoe said.
He said the increase in household spending largely reflected price increases, as there was little change in the volume of goods and services consumed by households.