The current exchange rate is about NZ$ 0.7 to a US dollar. So, you would expect that things would be somewhat cheaper here for us as Americans. Not so. Our first introduction to this was when our daughter informed us that a new Honda Accord sells for NZ$ 60,000 (about $42,000 US). Here it is, one of the most popular sedans in the world costing about twice as much as we would pay in the States. How can an average person here, who by all accounts don’t earn enough to buy a Honda, afford one? (Then again, how can so many Americans afford expensive foreign cars?) Okay, since our daughter did get a good price on a used Subaru, I let this particular example go as a classic example of supply and demand.
Consumer goods likewise required a lot of pocket change. A Panasonic ZR1 portable digital camera that cost $185 in the U.S. was priced at NZ$ $445. An 8GB iPod Touch from the NZ Apple Store runs NZ$ 349, while here it can be had for $199. A Sony Bravia KDL40EX600 LCD TV retails at NZ$ 2,300; here it lists at $1,200. So, toys will be significantly more expensive in NZ.
How about prices for other goods and services?
Grocery store prices are a good gauge to see how much it costs to live. We went to a Mexican products store and noticed that a can of hominy sells for NZ$ 10, a can of enchilada sauce for NZ$ 12. OK, so maybe making an authentic Mexican meal is relegated to the Sunday night meal. What about basic food? A can of diced tomatoes goes for NZ$ 2.25, a jar of Best Foods mayonnaise for NZ$ 12.95, a box of Barilla no-boil noodles for NZ$ 3.09, 1-kg (about 2.2 lb) of yogurt for NZ$ 7.99, a 500-ml (17 oz.) bottle of rice vinegar for NZ$ 12, a can of tuna for NZ$ 2.68. So, even for basic foods, some items can get pricey relative to U.S. standards.
Eating out turned out to be a very expensive proposition. Even the Lonely Planet guidebook warns that restaurant food is expensive. We were ever amazed at the prices of entrees on menus. It was not unusual for many items to be in the NZ$ 20+ range and, in a few places (by no means upscale restaurants), NZ$ 30+.
Without doing any research into the subject, I came to the conclusion that the main problem appears to be that New Zealand doesn’t have many home-grown industries. Imported items tend to be very expensive.