Property values in Aotearoa New Zealand edged down by -0.1% in May and remain -1.6% below a year ago.
The latest slight fall in values on the Cotality hedonic Home Value Index comes after some previous months of modest gains, with the national median now at $818,132. That remains 16.3% below the January 2022 peak.
Values were patchy around the main centres in May, with Kirikiriroa Hamilton inching up by +0.1%, but Ōtepoti Dunedin and Tauranga both edging down by -0.1%. Tāmaki Makaurau Auckland dipped by -0.3%, Te Whanganui-a-Tara Wellington by -0.4%, and after a period of resilience, Ōtautahi Christchurch fell by -0.8%.
Cotality NZ (formerly CoreLogic) Chief Property Economist Kelvin Davidson said May’s figures were a reminder that any emerging housing upturn could well remain slow and variable for the time-being, both from month to month and across regions.
“Lower mortgage rates are clearly going to be bolstering households’ confidence as well as their wallets, and there were signs of higher loan-to-value and debt-to-income ratio lending activity in the latest Reserve Bank figures.”
“But it’s not one-way traffic. After all, housing isn’t necessarily affordable in absolute terms, while the economy and labour market remain subdued too. Indeed, filled jobs edged lower again in April. These are certainly restraints on buyers’ willingness to push ahead with property deals or to pay higher prices.”
“May’s drop in values at the national level was fairly trivial and could be reversed next month. But anybody who was anticipating a sharp or widespread increase in property values as we got further into 2025 continues to be disappointed.”
Tāmaki Makaurau Auckland
May was a patchy month for the various sub-markets across Tāmaki Makaurau Auckland, with Rodney recording a +0.4% rise, Franklin up by +0.2%, and Waitakere holding steady. But Auckland City and Manukau both fell by -0.3%, with Papakura (-0.6%) and North Shore (-1.0%) registering even larger drops.
Franklin and Rodney remain higher than three months ago, but the rest of Auckland’s sub-markets have seen values drop since February (albeit only -0.1% in Manukau).
Te Whanganui-a-Tara Wellington
The wider Te Whanganui-a-Tara Wellington area is another market showing inconsistent growth patterns for property values.
Lower Hutt scraped in with a small increase in May, but Upper Hutt edged down, as did Kapiti Coast and Porirua. Wellington City itself recorded a -0.7% drop in May, with values in the capital still -0.8% down from February too.
“As we’ve been suggesting for a while now, the really sharp falls in Wellington property values seem to have petered out, but that doesn’t mean a fresh boom lies in store. Indeed, economic confidence remains soft, and as with many other parts of the country, available listings are high, which means buyers aren’t in a rush to compete or bid up prices sharply,” said Mr Davidson.
Regional results
Compared to the main centres, property values were generally a little more resilient around the provincial markets in May, with Queenstown rising by +1.2% (reversing modest declines in March and April), Invercargill by +0.5%, with Rotorua, New Plymouth, and Hastings also increasing. Most other regional centres were either flat or down only slightly.
“May saw a mild divergence in property performance when you look at the main centres versus regional areas, with better affordability always a support for the provinces to some degree. But with the underlying economy still relatively subdued, it’s certainly still much too early to suggest that property values in regional NZ are about to pull away,” added Mr Davidson.
Property market outlook
Looking ahead, Mr Davidson noted that 2025 still seems likely to be ‘the year of conflicting forces’ in the housing market, with factors such as lower interest rates bolstering activity and prices, but other restraints dampening those effects.
“The return to some kind of normality for sales volumes should start to eat into the overhang of available listings on the market in the coming months. But listings are starting from such a high level that buyers are likely to continue to have the upper hand for most of the year, with the associated restraint on house prices.”
“Based on recent trends, even our modest expectation for a 5% rise in national values in 2025 is looking a bit strong, although the year still has quite a long way to run.”
“Either way, a subdued or ‘balanced’ market is probably what we’ve been needing for a while now – opportunities for different buyer groups, first home buyers and investors included, with reduced risk of prices running away from them again,” Mr Davidson concluded.
CoreLogic New Zealand