New Zealand’s property market recorded a second consecutive month of modest growth in March, with national home values rising 0.2%, according to the latest Cotality NZ Home Value Index.
The result mirrors February’s lift and points to a market that may be starting to stabilise. Even so, the broader backdrop remains mixed, with ongoing global uncertainty continuing to weigh on household and business confidence.
The national median property value now sits at $802,599. That is 1.3% lower than the same time last year and remains below the market peak of early 2022, when values reached $968,333.
A market beginning to stabilise
LJ Hooker Head of Research Mathew Tiller said the latest figures suggest the market is gradually finding a base, although conditions still point to a slow and uneven recovery rather than a sharp rebound.
“Two months of growth, even at modest levels, is an encouraging sign that the market may be starting to find a floor,” Tiller said.
“However, the gains remain modest and need to be seen in the context of the correction since 2022. At this stage, it points more to a market stabilising than one entering a strong upswing. Confidence remains the key missing ingredient,” Tiller said.
“Lower borrowing costs are beginning to support the market, but confidence has not returned in full. Households are still cautious, and that is keeping any recovery in property values relatively measured.”
Diverging trends across the main centres
March’s data again highlighted different conditions across New Zealand’s major urban markets.
Auckland and Tauranga were flat over the month, while Hamilton and Wellington recorded slight declines of 0.1%. In contrast, Christchurch and Dunedin posted stronger gains of 0.6% and 0.7% respectively.
“Auckland remains a market of mixed signals,” Tiller said.
“Improved affordability compared with recent years is helping bring some buyers back into the market. However, broader economic confidence is still subdued, which is likely to keep the pace of growth relatively modest in the near term.”
Wellington also remains mixed, with some sub regions recording gains while others continue to soften. Over a longer period, the capital remains one of the weaker performing parts of the country.
“Wellington is still working through a combination of increased housing supply and softer economic conditions,” Tiller said.
“That is creating a more fragmented market, where performance can vary noticeably even between neighbouring areas.”
Regional markets continue to show resilience
Outside the main centres, several regional markets are continuing to perform relatively well.
Napier, Gisborne and Invercargill all recorded stronger monthly growth, with Invercargill again standing out, up 1.7% in March and more than 7% over the past year.
“Some regional markets are being supported by steadier local conditions and more affordable price points,” Tiller said.
“In some cases, values are now back at or close to previous peaks, which shows parts of regional New Zealand have remained quite resilient.”
He said those markets are still not immune to broader headwinds.
“Even regions with solid fundamentals can still be affected by higher fuel costs, softer confidence and wider economic uncertainty.”
First home buyers still active
Despite the mixed backdrop, first home buyers remain active in the market.
“For buyers with secure employment and a clear financial position, current conditions are still presenting opportunities,” Tiller said.
“Values remain below peak levels in many parts of the country, and that is creating an opening for well prepared buyers to enter the market.”
Outlook remains balanced
Looking ahead, the market appears to be entering a more stable phase, although the recovery is still likely to be gradual.
“There are some encouraging signs emerging, including stabilising values and steady buyer activity,” Tiller said.
“At the same time, risks around inflation, interest rates and the broader global backdrop remain, so expectations for a sharp rebound should stay measured.”
He said confidence would be the key factor over the months ahead.
“The market is moving in the right direction, but the pace of recovery is likely to be gradual. Much will depend on how confidence and economic conditions evolve from here.”
March’s figures suggest the New Zealand property market is settling into a more stable pattern, with back to back months of modest growth an early sign that conditions may be improving.
Even so, the market remains uneven, and the recovery is still likely to be slow rather than sharp.
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