Property market is back in growth mode

The next phase in New Zealand's property market has begun, CoreLogic has declared, after reviewing data from the first three months of the year.

The turnaround started in January when the national median price remained flat (ending a brief downturn), before rising 0.4% in February and another 0.5% in March.

Furthermore, in the first quarter of the year, 54% of suburbs experienced increases in house prices and 56% increases in apartment and townhouse prices.

As a result, while performance differs from location to location, the national property market appears to have started its next phase of growth.

New Zealand's median price climbed to $812,195 at the end of March, which was the highest since June 2024 – although still 16.3% lower than the January 2022 peak.

Confidence is returning to the market

CoreLogic NZ Chief Property Economist Kelvin Davidson said the number of suburbs experiencing price declines had fallen, indicating the early stages of an upturn that had been some time in the making.

“The falls in mortgage rates since around July or August last year were always going to take a little bit of time to flow through to house prices, given the weak economic environment and subdued household confidence. The abundance of listings has been an extra limiting factor for property values, while some households on higher fixed interest rates from a year or two ago have also had to be patient before seeing their debt repayments drop. But the lags have now worked their way through the system and, with signs becoming clearer that the economy has started to turn a corner, confidence is returning to the property market,” he said.

“That said, a fresh boom in house prices seems unlikely, given additional restraints that are now in place, such as caps on debt-to-income ratios for mortgage lending.

“Undoubtedly, this cautious outlook will be welcomed by aspiring buyers who may have been concerned about property values rising beyond their reach again, provided that they can navigate the new credit rules in the first place.”

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