Category: General election

Source: Cotality

Property values in more than half of New Zealand suburbs have stabilised or risen in the past three months, suggesting the country’s housing market is gradually finding its footing after several subdued years.

The latest update of Cotality’s Mapping the Market interactive tool, which provides suburb-level property insights across the country, shows 56% of suburbs recorded either stable or rising standalone house values over the three months to March. That is up from 44% three months earlier, indicating a modest strengthening in market conditions.

Cotality NZ Chief Property Economist Kelvin Davidson said the figures show the national market may appear subdued on the surface, noting results were more nuanced as more suburbs stabilised or recorded modest gains.

“At a high level, the NZ property market has been trending sideways in recent months,” he said.

“Sales activity has been lifting for some time now, but elevated listings are still keeping pricing power largely with buyers, which is why overall value growth has remained fairly subdued.”

“But suburb-level figures show that the cautious attitude does not apply everywhere.”

Rural regions showing resilience

Some of the strongest value gains have emerged in regional areas with 30 suburbs recording house value growth of at least 3%, with many located in Southland, Otago and the West Coast.

Among the strongest performers were Karitane in Dunedin and Blackball in Grey District, which each saw house values rise by more than 6%, while Mataura in Gore recorded growth of more than 4%.

Mr Davidson said relatively better affordability and the strength of the farming sector at a regional level had likely supported housing demand in those regions.

“Some of the more affordable regional markets linked to strong rural economies have been holding up well,” he said.

“That combination of lower price points and stable local economic conditions can provide a bit more resilience when the broader market is subdued.”

Patchy results across cities
While some regional areas have shown resilience, conditions in some other markets remain mixed.

Suburbs such as Crofton Downs and Kelburn in Wellington recorded house value growth of 3 – 4% in the March quarter, while Stillwater in Auckland and Aranui in Christchurch both rose by almost 2%.

However, declines were also recorded elsewhere across the country. For example, Little Wanganui in Buller fell by around 6%, while Wellsford in Auckland’s Rodney district dropped by almost 3.5%.

Mr Davidson said the suburb-level data highlights the uneven nature of the housing market at present.

“When you drill down to suburb-level data, conditions become much more varied. Some areas are already seeing values stabilise or edge higher, while others remain softer depending on local economic conditions, supply levels and affordability,” he said.

Townhouse markets remain softer

For townhouses and flats, 53% of suburbs recorded stable or rising values over the three months to March, indicating slightly weaker conditions than the standalone housing market.

A total of 45 suburbs recorded townhouse value increases of at least 3%, with 10 suburbs rising by 5% or more, including Tauranga South, Belleknowes in Dunedin, and Oamaru.

However, several areas also recorded declines, including Wesley and Goodwood Heights in Auckland, which both saw values fall by more than 3%.

Mr Davidson said the pipeline of new housing supply is still putting some downward pressure on prices in certain areas, such as Auckland, where there’s been a significant pipeline of fresh townhouses completed.

Wide price differences across NZ suburbs

Among standalone houses, Herne Bay in Auckland remains the country’s most expensive suburb, with a median house value of around $2.99 million, followed by Saint Marys Bay at $2.86 million.

At the other end of the spectrum, several suburbs have median house values below $300,000, including Patea in South Taranaki, Blackball in Grey District, and Clinton in Clutha.

Mr Davidson said Mapping the Market helps reveal the diversity of housing markets across the country.

“The suburb-level data highlights just how different local housing markets can be,” he said.

“Even within the same region, property values and trends can vary quite significantly depending on local supply, demand and economic conditions.”

Outlook points to modest growth

Mr Davidson said NZ’s housing market is positioned for modest value growth through 2026, adding that the General Election, debt-to-income lending restrictions and global economic risks would remain important factors to watch.

“Affordability has improved compared with the peak of the market, mortgage rates have stabilised and listings appear to be easing slightly,” he said.

“Those factors should support some gradual value growth this year, but buyers and sellers remain cautious, so the prospect of a boom looks unlikely.”