The Cotality Home Value Index showed a -0.2% drop in June, which is a modest fall, but nevertheless highlights the continued caution that exists out there in the market from both buyers and sellers. Values have dipped by -0.9% over the past year and remain 17.5% below the peak.
Around the regions
At a more detailed level:
- Auckland was down by -0.5%
- The wider Wellington area by -0.4%
These two key main centres have been dragging the chain for quite some time now, and both remain more than 20% below the peak. The continued pipeline of new housing will be weighing on Auckland values, while Wellington is being dampened by public sector job uncertainty.
- Hamilton up +0.5%
- Tauranga down -0.2%
- Nelson down – 1.0%
- Christchurch up +0.2%
- Dunedin +0.2.%
There were slight falls in previously-resilient areas such as:
- Queenstown down 0.3%
- Invercargill down 0.2%
Given the continued appeal for wealthy buyers in Queenstown and Southland’s strong agricultural base, the modest falls in June will probably prove to be blips rather than a new downwards trend. But this is a reminder of the subdued housing sentiment that is lingering beneath the surface.
If you would like a full breakdown of the Home Value index in your region, or city, click HERE
The macro drivers might be turning
It seems pretty likely that continued uncertainty around the Iran conflict and previous increases in mortgage rates will have contributed to the ongoing sluggishness for property values in recent months. Listings remain high too, given buyers a lot of the pricing power.
However, the latest positive development has obviously been the US-Iran peace deal, and if it holds this could set the scene for some degree of housing growth later in the year – both in terms of sales volumes (which have made a soft start to 2026) and property values. Indeed, mortgage rates have already been cut in recent weeks by some of the banks.
That being said, it’s too early to expect anything other than a modest upturn. After all, the labour market and job security always play a key role in housing trends, and for now there doesn’t seem much prospect of a meaningful fall in the unemployment rate until 2027.
The election is coming into focus
Of course, while owners and vendors may be disappointed with a subdued outlook, it’s still a favourable time to be a purchaser. First home buyers certainly continue to take advantage of sluggish conditions, with their market share having reached new record highs lately.
On the other hand, movers (relocating owner occupiers) remain a bit quieter than normal, and there have also been hints that mortgaged multiple property owners – including Mum and Dad investors – are starting to bide their time too. Weak rents, higher operating costs, and the risk of increased taxes after the election (e.g. CGT and/or non-deductibility) seem to be headwinds.
July’s OCR decision may turn out to be a hold but increases at some stage later in 2026 are still on the cards. All in all, it remains a challenging environment for the housing market.
At The Mortgage Supply Co, we’re here to guide you every step of the way, whether you buying, selling, or refinancing. Reach out to our team today to discuss your unique situation and how we can support you in navigating the ever-changing property market!
