Sales volumes, home values rise as mortgage rates ease and confidence returns
New Zealand’s housing market is showing clearer signs of recovery, with sales activity and home values lifting steadily in early 2025, supported by rate cuts and growing optimism among Kiwis.
According to CoreLogic NZ’s April Housing Chart Pack, national sales volumes in March were 11% higher than the same time last year, marking nearly two years of consistent growth in property transactions.
“Clearly confidence levels are growing, no doubt reflecting the falls in mortgage rates,” said Kelvin Davidson (pictured), CoreLogic NZ chief property economist.
Home values climb nationally and regionally
CoreLogic’s Home Value Index showed national property values edged up 0.5% in March, following a 0.4% gain in February, and a flat result in January. Over the three months to March, median values rose 0.9% across New Zealand.
“The recovery in property values and activity levels is becoming clearer, but it remains measured,” Davidson said. “Higher stock levels are still giving buyers plenty of choice, which will keep a lid on price growth in the near term.”
Investor confidence rebounds as mortgage rates drop
While high listing volumes continued to offer buyers more choice, recent improvements in borrowing conditions have reignited interest from various buyer groups. Investor activity, in particular, is trending upwards.
“Mortgaged investors remain on the comeback trail,” Davidson said. “Lower interest rates are certainly helping investors by reducing the cashflow top-ups out of other income sources that are generally required on a rental property purchase.
“While the share of purchases going to mortgaged multiple property owners (MPOs, including investors) remains below historical levels, this group has certainly started to return. Indeed, at 23% in Q1 2025, they’re back to levels not seen since late 2021.”
More sales forecast in 2025 across buyer segments
Davidson expects buyer activity across the board to increase as confidence grows.
“If current momentum continues, we anticipate around 10,000 more residential sales this year compared to 2024,” he said. “That means more opportunities for everyone—first-home buyers, investors, and upgraders alike.”
Mixed economic outlook may support further rate cuts
Although global economic uncertainty—driven in part by recent US tariff changes—presents risks, the inflationary impact in New Zealand is expected to be mild. Inflation is now back within the 1–3% target band, and following April’s 0.25% OCR cut, further reductions are likely.
“The year ahead is likely to deliver a subdued but broad-based upturn,” Davidson said.
“Lower mortgage rates are doing much of the heavy lifting, but high listing volumes, ongoing labour market shifts, and mortgage lending constraints such as debt-to-income ratio caps will temper the pace of growth.”
Key housing market stats from CoreLogic’s April 2025 Chart Pack
- NZ’s residential market is worth $1.62 trillion
- Home values rose 0.5% in March and 0.9% over the quarter
- Total annual sales: 83,543 properties
- March listings: 30,524—23% above the five-year average
- Rental market still tenant-friendly with high listing volumes and easing migration
- Gross rental yields at 3.9%—the highest since mid-2015
- Investor share of purchases back to 23% in Q1 2025
