Property Values Still Going Nowhere Fast

The result mirrors the annual change, which was also a –0.2% drop, bringing the median value nationally to $819,921. Cotality NZ Chief Property Economist Kelvin Davidson said the result was yet another reminder that market conditions remain subdued.

“At the end of 2024, our analysis suggested that 2025 was likely to be a ‘year of conflicting forces’ in the property market, with the upwards influence on house prices from lower mortgage rates counteracted to an extent by headwinds such as an abundance of listings and the weak labour market.”

“That broad theme has proven correct, with regions including Auckland and Wellington remaining soft. Even in more resilient areas such as Hamilton and Christchurch, the picture isn’t that much better.”

“The jobs market uncertainty is surely a key limiting factor at present.”

“That said, rising sales activity has now started to erode the stock of available listings a touch, probably augmented by some would-be vendors actively withdrawing their listed properties from the market.”

“This could lead to more competitive price pressure later in the year, especially as a greater number of existing borrowers roll off older, higher mortgage rates and down to current levels.”

Across New Zealand, Tāmaki Makaurau Auckland and Ōtepoti Dunedin were the weakest of the main centres in July, dropping by -0.6% apiece – with the former also -1.4% down in the past quarter.

Te Whanganui-a-Tara Wellington dipped by -0.2% and Ōtautahi Christchurch saw a minor -0.1% decline, although values are still slightly higher (+0.4%) than three months ago.

Meanwhile, Kirikiriroa Hamilton saw a +0.4% lift in July, with Tauranga up at +0.9%. However, that’s not necessarily a clear new trend in Tauranga, with some previous softer months meaning it’s still only +0.8% higher over the past year.

Tāmaki Makaurau Auckland

July data will likely temper any emerging optimism around Tāmaki Makaurau Auckland’s residential property market, with only Rodney (+0.1%) narrowly avoiding a drop. Franklin, Papakura, and Waitakere all saw relatively modest declines, but the falls were -0.6% to -1.0% in Manukau, Auckland City, and North Shore.

Each sub-market has seen values drop over the past three months, while only North Shore has managed to record a minor lift over the past year.

Mr Davidson said, “the stock of available listings around Tāmaki Makaurau has started to drift down, but it’s starting from a high level, and the latest property value figures re-emphasise that it’s still a buyer’s market in our largest city.”

“Indeed, the Cotality Buyer Classification figures show that first home buyers and mortgaged multiple property owners are enjoying conditions at present and taking a higher share of purchasing activity.”

Te Whanganui-a-Tara Wellington

Value patterns were variable in the wider Te Whanganui-a-Tara Wellington area in July, with Te Awa Kairangi ki Tai Lower Hutt up by +0.3%, and Porirua also edging higher.

By contrast, there were falls in other key sub-markets, such as Wellington City itself.

Over the past year, Porirua has managed to sneak up by +0.8%, while all other areas have dropped. Yet even Porirua is still substantially below its peak too (-21.6%).

“Te Whanganui-a-Tara Wellington’s previous sharp downturn in property values is likely to have come to an end, but that doesn’t mean an upturn has suddenly emerged.

In fact, market confidence levels around the Capital seemingly remain low, and property value trends are inconsistent from month to month,” Mr Davidson noted.

Regional results

If anything, there was a little more resilience for property values in provincial areas than the main centres in July, possibly reflecting NZ’s ongoing two-speed economy, with primary industries faring relatively well but other sectors subdued.

To be fair, Tūranganui-a-Kiwa Gisborne saw a -1.3% fall in values in July, but the drops were more minor in other regional markets, while Heretaunga Hastings, Whangārei, and Ngāmotu New Plymouth all rose by at least +0.5%.

“It’s early days and any perceived rural-urban divide in the property market at present should not be overplayed. After all, housing conditions are still fairly subdued almost everywhere. But a potential export-led recovery over the next year or two may well be a factor to watch in terms of boosting regional house prices relative to urban areas.”

Property market outlook

Looking ahead, Mr Davidson’s expectations for house sales and prices over the rest of 2025 and into 2026 remain cautious. “We have recently seen the number of sales return to some kind of normality and this upwards trend may well continue in the near term.”

“But market activity levels aren’t racing away and both buyers and sellers seemingly remain in a measured mood.

First home buyers and ‘Mum and Dad’ investors are active groups on the purchaser side of the equation at present, but it’s also worth noting that many vendors aren’t rushed at present either – those who are confident about their employment security may well be happy to wait for the price they want.”

“All eyes will be on the next official cash rate decision on 20th August, which looks relatively likely to be a cut to 3%. Yet we may already be close to, or at, the bottom for mortgage rates across many of the various fixed-rate terms, and in the meantime the economy is still struggling to get into its stride off the back of monetary policy easing.”

“After previous indications that an increase in national median property values of around 5% might be on the cards in 2025, a smaller increase now looks more likely. In fact, on recent form, the market may struggle to generate much more than a 1-2% rise in 2025,” Mr Davidson concluded.