PHOTO: Cotality (formerly CoreLogic) has released its May 2025 housing market update. FILE
📉 Latest Market Data Shows Mixed Picture
Cotality (formerly CoreLogic) has released its May 2025 housing market update, revealing a 0.1% nationwide drop in property values — now sitting 1.6% lower than a year ago.
However, the real story is the divergence between the regions and the main centres.
While Auckland prices dipped by 0.3% and Wellington slid 0.4%, some regional centres defied the trend:
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📈 Invercargill: +0.5%
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📈 Queenstown: +1.2%
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📈 Rotorua, New Plymouth, and Hastings: Also reported growth
Hamilton was up 0.1%, while Christchurch saw a sharper fall of 0.8%. Tauranga and Dunedin dropped slightly by 0.1%.
🧠 Expert Insight: “A Gap is Opening”
Chief Property Economist Kelvin Davidson noted that the market is showing “a little bit of a split between the regions and the main centres.”
“There’s a sense a gap is opening up,” he said. “It’s probably just symptomatic of the market we’re in.”
Davidson pointed to factors impacting all markets — such as lower mortgage rates and a weaker overall economy — but also highlighted stronger performance in rural economies as a boost for some provinces.
🐄 Primary Sector Strength Feeding Property Confidence
With Fonterra forecasting $10 per kilogram of milk solids for 2025/26, Davidson noted rural confidence may be pushing up property transactions.
“Farming is doing pretty well. That might be driving a bit of spending in those areas.”
🏛️ Main Centres Still Feeling the Pain
Cities like Wellington continue to reel from public sector job cuts, dampening local demand.
Davidson cautioned that while there are signs of recovery, any upturn will be “slow and variable.”
🏦 Lending, Listings & Cautious Optimism
Reserve Bank data shows increased lending under high LVR and DTI ratios — a potential sign of life. But Davidson reminded buyers and sellers: “It’s not one-way traffic.”
Household confidence is returning with lower mortgage rates, but affordability issues and a subdued labour market remain headwinds.
With listings still high, buyers are likely to hold the upper hand for much of 2025.
🔮 Outlook: 5% Growth Too Optimistic?
Davidson signalled that his earlier forecast of a 5% rise in national values might now be too bullish — but the year is far from over.
“Either way, a subdued or ‘balanced’ market is probably what we’ve been needing,” he said, suggesting it’s an environment that suits both first-home buyers and investors.