Sales activity rising but below average
Property sales have been increasing in recent months, but they remain 10–15% below typical levels, according to Trade Me Property’s latest Property Market Update.
This subdued activity, combined with a seasonal rise in new listings, has pushed the stock of available properties to a six-year high for this time of year, shifting the balance of power firmly in favour of buyers, according to CoreLogic’s Kelvin Davidson (pictured above).
Property values see continued decline
The CoreLogic Home Value Index (HVI) recorded its eighth consecutive national decline in October, with property values falling 5% since February’s mini peak.
Davidson, CoreLogic chief property economist, noted the differences across regions.
“Auckland and Wellington have been underperforming lately, with a touch more resilience in markets such as Christchurch,” he said.
First-home buyers lead activity
First-home buyers (FHBs) are thriving in the current property market, accounting for 26–27% of purchases in recent months.
Many are leveraging KiwiSaver for deposits and utilizing low-deposit lending allowances. FHBs have also shown flexibility by exploring new builds or compromising on property type and location.
Investors slowly returning
Mortgaged multiple property owners remain quieter than usual, holding a 22% market share, below their long-term average of 25%. However, this share has started to rise slightly, supported by lower mortgage rates and improved deposit requirements.
“Lower mortgage rates are enticing a few more ‘mums and dads’ back to the property market,” Davidson said.
What lies ahead for 2025?
Davidson predicts a 0.5% OCR cut later this month, which could drive mortgage rates lower, albeit at a slower pace.
While these rate reductions may end the current house price downturn, Davidson cautioned, “Just because a downturn finishes doesn’t necessarily mean that a strong upturn suddenly begins.”
Rising unemployment and debt-to-income ratio caps are likely to restrain any market recovery, suggesting a steady but modest upturn in 2025.
Read the market update in full on the Trade Me Property website.
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