Is New Zealand’s housing market entering an era of lower growth?
New Zealand's housing market may be shifting toward a lower-growth era, with annual price increases potentially stabilizing between 3-5%. Analysts suggest that factors like increased supply and stricter lending rules are cooling the rapid growth seen in previous decades.
Why it matters
This shift represents a significant change for homeowners and investors who have relied on high historical growth rates for wealth accumulation.
The rolling 10-year growth rate for New Zealand's national median property value has recently slowed to a historically low level, says Cotality. Photo / 123rf
New Zealand may already be transitioning to a lower-growth housing market as rapid price gains of previous decades become less common, property data analytics company Cotality says.
While the national median property value remains 19% below its previous 2021-22 peak, it is still 37% higher than in September 2016.
That is equivalent to average annual growth of 3.2%.
“Being below the previous peak matters enormously for somebody who bought near the top of the market, particularly if they now need to sell,” Cotality New Zealand chief property economist Kelvin Davidson said.
“But most home owners didn’t buy at the peak. When we look over a longer period, the picture changes significantly.”
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