ANALYSIS: There is a good range of data now available on what is happening in New Zealand’s residential real estate market, ranging from my own monthly surveys to the long-running releases from the likes of the Real Estate Institute of New Zealand (REINZ) and property portal Reconz.
The latest information on the number of homes available for purchase from Reconz shows seasonally adjusted listings at 34,000, which is about the same as a year ago and up from just 13,500 in the middle of 2021. The number of properties newly listed over the past three months was up 5% annually, and just slightly above the 10-year average for this measure.
Basically, things are steady. No big surge in stock, no large withdrawal of vendors. However, this week, a few real estate agents sent me a press release from the portal that started with this quote: “The market is back in motion as [the] latest data reveals activity in the New Zealand property market has returned to 2021 levels.”
It sounds great. The ball is apparently rolling quite well. No, it is not, and the direction is in fact downward.
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Let’s start with some easy comparisons between the current market and the market in 2021. In the past year, dwelling sales totalled 79,500, which is a good rise from the annual count of 59,000 in the middle of 2023. The 2021 total was 89,000, including a 12-month peak of 100,000 in the middle of the year.
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In the March quarter of 2021, it took an average of 31 days to sell a house. The average now is 50 days. The only thing the same now as back then is prices.
As measured by the REINZ’s nationwide House Price Index, prices over the March quarter of 2026 were the same as in the March quarter of 2021. But back then, prices were up by 22% on the year before and up by 8.5% on the previous quarter. Now, prices have dropped by 0.1% on the year before and just 0.2% ahead of the December 2025 quarter.
The current real estate market momentum is weak, and according to my latest survey of real estate agents undertaken with NZHL, it is getting weaker.
Whereas in early 2021, 86% of agents said buyers were displaying FOMO (fear of missing out), now only 5% agents say the same. Five months ago, 26% were. A net 50% of agents have noticed fewer investors in the market, down from a net 6% who saw more at the end of January. Investors have again backed strongly away from the market, amidst deepening worries about costs and where prices are headed.
Independent economist Tony Alexander: "Young people continue to take advantage of a market that’s strongly in their favour." Photo / Fiona Goodall
In fact, a net 44% of agents say that house prices are falling in their area. Just three months ago, a net 10% said they were rising. In early 2021, a net 92% of agents were recording price rises.
A net 51% of agents say that fewer people are currently showing up at open homes, whereas three months ago, a net 55% said more people were showing up.
The impact of the Iran war has been immediate and deep, and, unfortunately, for the third time since the recovery in real estate sales from early 2023, an upturn in the market has stalled.
But is everything bad? No. A net 26% of agents still say that they are seeing more first-home buyers in the market. That is down from 62% three months ago, but still firmly positive. Young people continue to take advantage of a market that’s strongly in their favour, and that means my interpretation of the current real estate market from a societal perspective is actually quite positive.
- Tony Alexander is an independent economics commentator. Additional commentary from him can be found at www.tonyalexander.nz
