After initially rising at the start of 2024, property values across many New Zealand suburbs have weakened recently, with a clear slowdown emerging over the past three months.
CoreLogic NZ’s latest Mapping the Market data reveals a mixed picture, with 50% of suburbs experiencing ‘meaningful’ value increases over the past year. However, more recent quarterly data shows a sharper decline, particularly in Auckland as well as areas such as Napier, Wellington, and Nelson.
CoreLogic NZ Chief Property Economist, Kelvin Davidson, noted that out of 951 suburbs covered in the update, 480 saw median property values rise by at least 1% since September 2023.
He described these figures as ‘decent,’ but warned that signs of a slowdown are now much clearer, especially in Auckland, where suburbs such as East Tamaki and Northpark saw values fall by more than 6% in the three months to September.
“The past 12 months is made up of two distinct phases: a period of recovery in late 2023 and early 2024, followed by a recent downturn over the past three months,” Mr Davidson said.
Since June, 674 suburbs have seen property values decline, which is 71% of the total, with 175 of those dropping by at least 2%.
“Over the past 12 months, we’ve seen a mixed picture in the market,” Mr Davidson said.
“While around half of the suburbs analysed have experienced value gains over that period, recent months have seen a shift in momentum. Rising affordability pressures, increased listings, and growing job insecurity have led to a more cautious buyer environment, resulting in falling values across other areas.”
Double-digit gains were recorded in eight suburbs in the year to September, led by the top increase of 22.6% to a median value of $313,000 in Cobden and 15.9% to $333,750 in Blaketown, both in Grey District.
Mr Davidson said the best performing suburbs were generally at the more affordable end of the spectrum, with five of the eight maintaining a median value of less than $500,000.
Outliers included the popular South Island historic hub of Arrowtown, where the median value of $2.45 million makes it the fifth most expensive suburb across the country.
“Markets such as Arrowtown and the wider Queenstown market are sought-after lifestyle areas, they hold broad appeal among tourists, second homeowners and owner occupiers which has made them more resilient despite the broader affordability pressures,” he said.
Auckland
Auckland’s property market has experienced notable declines, with 129 of 200 suburbs recording drops in value over the past year. Of these, 57 suburbs fell by at least 2% and in the last three months, 183 suburbs saw declines, with East Tamaki, Northpark, and Somerville all recording falls of more than 6%.
Herne Bay remains the country’s most expensive suburb at $3.38 million, while Auckland Central is the most affordable within the super-city at $528,100.
“The renewed weakness in Auckland’s market reflects broader affordability pressures and cautious buyer sentiment, which are now evident across several regions beyond Auckland,” Mr Davidson said.
Hamilton
Hamilton’s property market has shown some resilience over the past year, with only three of its 35 suburbs experiencing a decline in median values.
Whitiora saw the largest drop, falling by just over 1%, while four suburbs posted gains of at least 4%, with Queenwood the best performer, increasing by 9.4%.
However, Mr Davidson said since June, a downturn has emerged, with 27 suburbs recording declines, three of which fell by more than 2%.
“Hamilton’s market remains relatively strong, but recent dips suggest the broader affordability pressures affecting other regions are starting to take hold here as well,” he said.
Tauranga
Tauranga’s property market has seen mixed results, with 10 of 20 suburbs recording value declines over the past year. Ohauiti and Otumoetai dropped by at least 3%, while Poike increased by 5%.
A clearer loss of momentum was recorded in the last three months with 17 suburbs declining since June, including Papamoa Beach down by 3.1%. Mount Maunganui remains Tauranga’s most expensive suburb at $1.31 million, with Poike the most affordable at $668,750.
Wellington
Wellington recorded early market cycle resilience, with only 12 of 96 suburbs seeing median value declines of 1% or more over the past year. Elderslea and Wilton led gains, rising by 7.1% and 6.7%, respectively.
However, more recent data shows there’s been a shift, with 74 suburbs declining since June, 52 of which dropped by at least 1%. Seatoun is Wellington’s priciest suburb at $1.76 million, while Wellington Central remains the most affordable at $481,450.
Christchurch
Christchurch’s property market initially held strong, with only three of its 84 suburbs seeing value declines over the past year, as Aranui and Kennedys Bush led the upswing with increases of more than 8%.
However, on the more timely three-month data, momentum has slowed, with 52 suburbs experiencing value drops since June. Scarborough is the city’s most expensive suburb at $1.84 million, while Phillipstown is the most affordable at $456,200.
Dunedin
Dunedin also showed solid growth over the year, with only five of 63 suburbs recording value declines and Helensburgh and Glenross leading increases with gains of at least 7%.
However, as with almost all other areas of the country, there’s been a more recent slowdown, with 41 suburbs seeing declines since June, including Sawyers Bay, which dropped in value by 3.3%. Maori Hill is Dunedin’s most expensive suburb at $1.02 million, while South Dunedin remains the most affordable at $413,150.
Property Market Outlook
After losing the momentum recorded in the first half of the year, Mr Davidson said the recent cut to the official cash rate and falling mortgage rates could offer some short-term relief to buyers.
However, Mr Davidson does not expect to see a swift rebound in property values following the most recent quarter’s declines, with further softening expected in the coming months.
“While lower mortgage rates will ease pressure on some buyers, affordability remains a major hurdle, and job insecurity is starting to hold back demand,” Mr Davidson said.
“Stock levels are at multi-year highs, giving buyers more leverage, but access to finance remains tricky, limiting how many can take advantage of the current conditions.”
Looking ahead, Mr Davidson expects the market to remain subdued into 2025.
“The tailwinds of lower rates may prevent a sharp decline, but we’re unlikely to see strong price growth in the near term,” he said.
“This may mean vendors who do not have to sell stay put until market conditions improve, while those looking to buy or invest could face delays unless they have the financial backing to negotiate in a competitive lending environment.”
Explore the full CoreLogic NZ interactive market map here.
Explore the Mapping the Market tool
<!– Need to output tags here
–>
Meet Kelvin Davidson
Chief Economist
Kelvin joined CoreLogic in March 2018 as Senior Research Analyst, before moving into his current role of Chief Economist. He brings with him a wealth of experience, having spent 15 years working largely in private sector economic consultancies in both New Zealand and the UK.