Housing market forecast

PHOTO: Cotality’s figures show different parts of the market moved at different speeds. FILE

🏠 What Happened to NZ House Prices in 2025?

Property values across New Zealand declined 1% over 2025, according to Cotality NZ’s Home Value Index, with most of the year spent sliding after early gains.

📉 December capped it off with a 0.2% drop, following a 0.1% dip in November.

✅ The national median value now sits at $808,430 — down 17.6% from the early 2022 peak.

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📊 Which Property Types Got Hit the Hardest?

Cotality’s figures show different parts of the market moved at different speeds:

  • 🏡 Houses: down 0.7% in 2025

  • 🏘️ Townhouses: down 1.8%

  • 🏢 Apartments: down 4.2%

🏙️ The Big Cities Struggled (Auckland, Wellington, Hamilton)

Most major centres finished the year under pressure:

  • 🌆 Auckland: down 0.6% in December; -2.6% over the year

  • 🏔️ Hamilton: down 0.7% in December

  • 🌬️ Wellington: down 0.4% in December; sub-markets down at least 1.2% annually

Meanwhile, Christchurch, Dunedin, and Tauranga managed modest monthly gains. 📈

🔥 The Twist: Southland Hit New Highs (Yes—Invercargill!)

While much of NZ eased back, Southland surged to new highs in December.

🏆 Invercargill reached a new peak median value of $520,464.
Other areas showing growth included Queenstown and New Plymouth.

Cotality’s Kelvin Davidson suggested stronger provincial performance is linked to relatively stronger economic conditions in some regions—especially agriculture. 🌾

⚖️ Why Prices Fell (Even With Mortgage Rates Dropping)

Cotality’s chief property economist Kelvin Davidson described 2025 as a year of “conflicting forces”:

  • 📉 Lower mortgage rates helped demand

  • 🏘️ High stock levels kept pressure on prices

  • 👷‍♂️ A weaker labour market cooled confidence

Another key factor: housing supply continues to rise relative to population, improving affordability and containing price growth.

🔮 What’s Coming in 2026? (Could Prices Bounce?)

Davidson flagged the chance of a ~5% rise in 2026 as confidence rebuilds on:

  • 📉 falling interest rates

  • 📈 improving economic conditions

But there are potential headwinds too:

  • 🗳️ election-year uncertainty

  • 🧾 policy/regulation changes (LVRs, DTIs)

  • 💰 ongoing debate around capital gains tax

Bottom line: 2026 could be stronger—but it won’t be smooth sailing.

✅ Quick Takeaways (If You Only Read One Section)

  • 📉 NZ property values fell 1% in 2025

  • 🏠 National median is $808,430 (still 17.6% below 2022 peak)

  • 🌆 Main centres lagged, especially Auckland & Wellington

  • 🏆 Invercargill/Southland hit new highs

  • 🔮 2026 could rise ~5%, but uncertainty remains

SOURCE : realestate.co.nz

 

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