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New Zealand market update

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The traditionally busier months on the residential real estate calendar have fulfilled their promise, with sellers more satisfied with market pricing and buyer activity.

Housing market activity stuttered out of the gate in 2023, reflecting sellers’ desire for certainty.

The market has found its footing in February and March, with a surge of new listings demonstrating how homeowners are eager to take advantage of current market conditions despite challenging affordability metrics.

Expectations post-election for a more favourable policy backdrop have worked together with record population growth to fuel demand for homes nationwide, with New Zealand adding 145,000 people to the national abacus in 2023.

Rentals, in particular, are in hot demand, which is a buoy for investors. At the same time, the government has reinstated their ability to deduct interest expenses from rental income. Effective 1 April 2024, residential investors can deduct 80 percent of interest costs for the year ahead.

This may well catalyse this group’s return to the market, important, because they make a valuable contribution to private rental supply which has been squeezed with record population growth and a deepening housing shortfall.

With fewer developers bringing new projects to market, forecasters expect pressure on a limited housing supply will likely increase competition, sustaining values despite an uncertain economic outlook.

We’ve seen buyers acknowledge this market pace, as they look to leverage current opportunities.

With the introduction of Debt-to-Income (DTI) rules this side of June, we could also see a greater proportion of house-hunters bring forward their purchasing decisions, supported by a better selection of properties available for sale, and a desire to make hay while the sun shines.

If you are exploring your options, Bayleys’ team members in any of our 100 offices are well-positioned to support your property endeavours and add value in this variable market.

We welcome requests across the breadth of our residential offerings and remain committed to providing the best customer service and optimal results for Kiwis and their real estate needs nationwide.

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Contact Email
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