Housing affordability is worsening and has plummeted to an all-time low, with households now needing nearly 12 years to save for a deposit.

The bi-annual Housing Affordability Report from property analysts CoreLogic showed the average property across New Zealand was now worth 8.8 times the average household income for the three months ended December, up from 8.3 just three months earlier, and much higher than the long term average of 5.9.

It would now take 11.7 years to save for a deposit, up from 11.1 years at the end of last September and well above 9.3 years from a year ago.

CoreLogic chief property economist Kelvin Davidson says housing affordability has got "significantly worse" on this measure.

"Historically, the average years to save a deposit has been 7.9, meaning it now takes almost four years longer today than in the past.

"Comparing today's figure to previous cyclical peaks is also worrying, with this measure topping out at 8.1 years in mid-2007 and 9.4 years in late 2016."

Davidson says as affordability becomes worse, ownership has decreased.

"There is a big challenge here and we've seen over a number of years that ownership rate has gone down but at the same time you've got people entering the market and perhaps just accepting that they are going to buy later in life."

Davidson says the affordability issue is broader than just for home buyers, with rental costs also soaring.

The CoreLogic report shows rental costs absorbed 22 per cent of gross average household income, another record high.

However, Davidson warns that the reality may be a lot worse.

"You've got to accept that in the real world it's fairly likely that the typical renting household isn't actually earning the average income so their income would be below the average."

Mortgage servicing is also continuing to getting harder.

CoreLogic says 48 per cent of gross household income is now required service an 80 per cent loan-to-value ratio mortgage, based on the average property value, with the mortgage over a 25-year term.

It's up from 42 per cent three months ago, and 33 per cent in the final quarter of 2020.

The record was 50 per cent just prior to the global financial crisis from 2007 to 2008.

"We're sort of 13 to 15 percentage points above normal, a lot of that has been due to the recent rise in interest rates ... but also the rising house prices."

-RNZ.