CoreLogic NZ's Kelvin Davidson analyses the 2025 market prospects for first-home buyers
Kelvin Davidson (pictured above), CoreLogic NZ chief property economist, provided an analysis into the current landscape for first-home buyers in 2025.
According to Davidson, while the percentage share of FHB activity may not sustain recent highs, the overall conditions remain favourable, supporting a robust entry into the property market for new homeowners.
Strong performance and strategic purchasing in 2024
Reflecting on 2024, Davidson said that first-home buyers made up a significant 26.1% of property purchases, setting a new record.
This group has effectively utilised tools such as KiwiSaver and low-deposit lending options, often opting for new-build properties to circumvent stringent loan-to-value ratio restrictions.
Despite a drop in median prices paid from $719,000 in 2022 to $698,000 in 2024, FHBs capitalised on a softer market, which presented ample choices and reduced competition.
Evolving dynamics in 2025
Looking ahead, Davidson anticipated an increase in overall property transactions in 2025, estimating sales to rise from about 80,000 in 2024 to 90,000.
This growth is expected to benefit all buyer segments, including FHBs, thanks to the delayed effects of lower mortgage rates and a gradually recovering economy.
However, potential challenges such as job losses and new debt-to-income ratio limits could shape the buying landscape.
Competitive outlook for FHBs
While FHBs are likely to secure a higher number of properties in 2025 than in the previous year, the resurgence of mortgaged investors and movers might dilute their market share, CoreLogic reported.
Despite this, the substantial reduction in mortgage rates is set to lower financial barriers significantly, making property investments more attainable for new entrants in the market.
The bigger picture for property buyers
The real estate market in 2025 is poised to be dynamic, with shifts in buyer demographics and investment strategies. While FHBs might witness a slight decline in their market share, the overall increase in property transactions will still favor their ambitions to own homes.
“A lower market share doesn’t mean the demise of FHBs,” Davidson said.
