Housing values stabilise in early 2025

The opening weeks of 2025 suggest a continuation of the static trend observed in New Zealand’s housing market, according to the latest QV House Price Index.
Nationally, residential property values have barely shifted, with a marginal increase of 0.1% in the December quarter.
The average home value now stands at $902,414, down by 0.3% from the beginning of 2024 and 15.2% below its peak over three years ago.
Market equilibrium ahead
James Wilson (pictured above), QV operations manager, indicated a steady outlook.
“It’s been ‘steady as she goes’ throughout much of last year, and it looks like it’s going to stay that way for a while yet,” Wilson said.
The housing market faces continuing challenges such as labour market weakness, high living costs, credit constraints, and an abundance of properties for sale.
Despite a boost in demand linked to falling interest rates, significant price increases remain absent, suggesting the market is nearing equilibrium.
Regional performance variance
While some regions like Rotorua, Marlborough, and Queenstown saw declines in property values, others experienced modest gains.
Notably, Auckland, Wellington, and Christchurch saw increases of 1.3%, 0.4%, and 1.1%, respectively.
Hamilton, New Plymouth, Nelson, Christchurch, Queenstown, Dunedin, and Invercargill began 2025 with higher average home values compared to the previous year.
Long-term growth prospects
Wilson remains cautiously optimistic about longer-term growth, despite the challenging economic landscape.
“In the longer term, I expect we will see more growth this year than last, but with rising unemployment and such a high level of economic uncertainty, there are currently no indications that house prices are suddenly going to go from flat to flat-out in the immediate future,” the QV leader said.
Investor influence and market dynamics
The potential for further interest rate reductions could draw more investors into the market, impacting first-home buyers.
“That will put a bit of price pressure on first-home buyers, who have picked up a larger share of the market in recent times,” Wilson said. “But it looks as though the economy is still in a dark place right now, and debt to income ratios should still keep a lid on things in the year ahead.”
Regional highlights
- Northland: Concluded 2024 with a 2% decrease in average home values, despite some growth in the December quarter.
- Auckland: Despite a decline of 3.1% over the year, the last quarter saw slight growth across the region.
- Tauranga: Ended the year lower annually, although it saw growth in the final months.
- Hamilton: Positively closed the year, with home values up by 0.6% from the start of 2024.
QV expert outlook for 2025
While the overall forecast remains modest, localised growth and market adjustments indicate a nuanced path ahead for New Zealand’s housing market.
With interest rates likely influencing market dynamics further, 2025 will be a critical year for gauging long-term trends in the housing sector.