{"id":505079,"date":"2026-07-01T21:14:08","date_gmt":"2026-07-01T21:14:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/505079\/"},"modified":"2026-07-01T21:14:08","modified_gmt":"2026-07-01T21:14:08","slug":"falling-house-prices-4800-gone-in-one-city-in-a-month","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/505079\/","title":{"rendered":"Falling house prices: $4800 gone in one city in a month"},"content":{"rendered":"

When adjusted for inflation, the drop is more like 30%.<\/a><\/p>\n

Christchurch and Dunedin both recorded increases in values in June but Tauranga, Wellington and Auckland experienced falls. <\/p>\n

Auckland\u2019s was the biggest of the main centres, down 0.5% in a month. Within Auckland, Manukau was down 0.7% in June.<\/p>\n

In dollar terms, Auckland\u2019s house price fall was $4854 for the month and $323,070 from the peak.<\/p>\n

\u201cWe\u2019ve already seen sales volumes continue to weaken<\/a> a bit as each month passes in 2026 and that has meant the supply of available listings on the market and buyers\u2019 choice remain high,\u201d Davidson said.<\/p>\n

\u201cThat in itself will tend to restrain property values, but on top of this we\u2019ve also had the Iran conflict rumbling on since early March, with associated adverse effects on economic activity, sentiment, inflation, and mortgage rates.<\/p>\n

\u201cGranted, the peace deal has improved the economic outlook. But the lagged effects of previous uncertainty are pretty clear to see in June\u2019s property value figures.\u201d<\/p>\n

He said recent falls in mortgage rates might improve buyer confidence but conditions were still in buyers\u2019 favour.<\/p>\n

Central Wellington recorded a drop of 0.9% in June, and 1.7% in the quarter.<\/p>\n

\u201cThere\u2019s a sense that the looming election is becoming a factor influencing the property market in general across the country, and this effect could be even more pronounced in Wellington given its concentration of core government services. Sellers may continue to have a difficult time as the year progresses,\u201d Davidson said.<\/p>\n

Even Queenstown dropped a little, down 0.3% in June. Invercargill, which had previously been noticeably resilient, was down 0.2%.<\/p>\n

\u201cThere\u2019s no doubt that most segments of the agricultural sector are doing very well at present and this will tend to support provincial property markets.<\/p>\n

\u201cBut the generally softer tone of the property value data in June is a reminder that sentiment and higher financing costs also matter greatly too.\u201d<\/p>\n

\u2018House price stasis\u2019<\/p>\n

BNZ chief economist Mike Jones said it was hard to see anything breaking this period of \u201chouse price stasis\u201d, which had persisted for the past three years.<\/p>\n

\u201cNational house prices stopped falling in the autumn of 2023 and have been flat since. Given heightened inflation over that same period, real house prices have been slowly deflating and our forecasts essentially have that continuing into next year.<\/p>\n

\u201cOur work indicates that, despite some retrenchment in recent years, NZ still stacks up as middling-to-elevated in a global comparison of typical house price valuation metrics. <\/p>\n

\u201cThat doesn\u2019t imply house prices need to fall further or can\u2019t lift from here. There\u2019s still a cycle. But it does support our sense there\u2019s downside risk on our house price inflation forecasts for this year [for no price movement] and next [for an increase of 4.5%].<\/p>\n

\u201cWith the interest rate easing cycle now behind us, I think any recovery in house price inflation will depend on whether rising migration, a slowly improving economy, and a steadying labour market can offset the headwinds from rising mortgage rates. <\/p>\n

\u201cIt\u2019s also worth noting that the supply pipeline still looks relatively healthy. So there are lots of balls in the air and plenty of uncertainty but, overall, I suspect think any recovery will be tepid.\u201d<\/p>\n

Squirrel founder John Bolton said history suggested a market recovery would take about a decade which could mean it was 2031 before prices were back to their 2021 peak.<\/p>\n

\u201cEven once prices are back at their 2021 peak in dollar terms, they\u2019ll still be down roughly 20% in real terms. And there\u2019s a genuine question in my mind as to whether we\u2019ll ever get that back \u2013 or whether what\u2019s happened has sparked too much of a shift in the way New Zealanders think about property.\u201d<\/p>\n

He said younger people now were more comfortable investing in shares and might no longer think property was the key to building wealth.<\/p>\n

Bolton said prices might be at the bottom in nominal terms but still had further to go when adjusted for inflation.<\/p>\n

Davidson agreed. \u201cThere are a lot of listings out there, buyers know they have the pricing power but also sellers aren\u2019t capitulating. Everybody\u2019s got a wee bit of power and it\u2019s keeping prices pretty flat. I guess for every person who might be under a bit more pressure to sell there are others who don\u2019t have to rush.\u201d<\/p>\n

He said he expected prices to keep \u201cbumbling along the bottom\u201d with a bit of risk of further falls.<\/p>\n

But he said the improvement in the fall in prices and improvement in housing affordability of the past four or five years should limit the extent to which prices could drop further.<\/p>\n

Infometrics chief forecaster Gareth Kiernan said the labour market would be an important influence. <\/p>\n

\u201cThere\u2019s probably still a bit of weakness in the near term and it\u2019s been interesting over the last few months seeing the stock of properties for sale just edging back up again.<\/p>\n

\u201cUntil you\u2019ve started to run that down a bit, it does act as something of a cap on house prices in the near term … it\u2019s flat probably this year then if you are starting to absorb that excess stock you might start to see a bit of upward momentum next year.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"When adjusted for inflation, the drop is more like 30%. Christchurch and Dunedin both recorded increases in values…\n","protected":false},"author":2,"featured_media":505080,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[251967,138,2199,813,38403,2219,10053,78,4486,111,139,69,5270,12937,812],"class_list":["post-505079","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-251967","tag-business","tag-city","tag-edmunds","tag-falling","tag-gone","tag-house","tag-in","tag-month","tag-new-zealand","tag-newzealand","tag-nz","tag-one","tag-prices","tag-susan"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/505079","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=505079"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/505079\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/505080"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=505079"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=505079"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=505079"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}