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New Zealand Property Market Forecast to Rebound in 2025 as Interest Rates Fall
- Real Estate Today - New Zealand
- 7 hours ago
- 2 min read
The New Zealand property market is poised for a moderate rebound in 2025, supported by falling interest rates and a gradual recovery in buyer sentiment, according to the latest survey of market analysts.
Following a prolonged downturn that saw New Zealand house prices fall nearly 20 per cent from their late-2021 peak, a Reuters poll forecasts a 5.0 per cent increase in average property values in 2025.
A further 6.0 per cent rise is projected for 2026, marking a cautious recovery in New Zealand real estate trends.
The Reserve Bank of New Zealand (RBNZ) has already delivered 175 basis points of monetary easing since August. Economists expect a further 75 basis points in cuts this year, bringing the Official Cash Rate to 3.00 per cent — a key move expected to stimulate the New Zealand housing market during an ongoing economic slowdown.
Despite the forecasted recovery, New Zealand housing affordability remains a critical concern.
The national median property price sits at approximately NZ$750,000, representing around six times the average household income. In Auckland, the affordability gap is even wider, intensifying home ownership challenges for first-home buyers.
While lower mortgage rates may reignite buyer demand, analysts warn that stagnant wage growth, elevated living costs, and the threat of a New Zealand recession in 2025 could limit the pace of recovery.
Any sharp resurgence in house prices could again outpace income growth, worsening structural affordability issues.
The New Zealand real estate sector remains a key barometer of economic resilience.
Although the New Zealand property market outlook for 2025 is improving, analysts suggest that gains will be moderate, reflecting a market still grappling with the balance between supply, demand, and economic uncertainty.
As interest rates fall, market watchers will be closely monitoring whether increased buyer activity can translate into a sustainable recovery — or whether housing affordability will remain one of New Zealand’s most intractable economic challenges.
