The Cotality Home Value Index (HVI) for the first month of the year has really just continued the soft trends we saw throughout much of 2025. At $802,617 in January, the national median value was a minor -0.1% lower than December and -1.0% down from first month of 2024. Peak to trough remains at -17.5%, compared to the January 2022 high of $972,743.
In other words, any growth in values remains elusive. So, what were the regional patterns in January and how has recent economic news changed the outlook, if any?
Values are moving differently by region and property
Although the national median is treading water, there is still variability when you dig a bit deeper. For example, standalone houses have ‘only’ seen falls of -0.7% in the past 12 months, with -1.7% for townhouses, and -4.1% for apartments.
The latter only accounts for 4% of our national housing stock (and mostly in Central Auckland and Wellington), but there are obviously still some concerns in that segment – perhaps around build quality, insurance/body corporate costs, and low migration.
There are also some differences by region too. Auckland and Wellington remain the softest of the main centres, with further (modest) falls in January, whereas Tauranga and Dunedin were more resilient, and markets such as Ashburton and Invercargill continue to reach new highs.
Better affordability in the provinces is surely a factor for outperformance, but also the underlying impetus from a solid farming sector.
If you would like a full breakdown of the Home Value Index in your region or city, click HERE
Still plenty for investors to keep an eye on
In this environment of high listings levels, low interest rates, and reduced house prices, first home buyers continue to fare very well, representing record % shares of the market. Tapping into the (just-increased) low deposit lending allowances at the banks is working in their favour too.
Meanwhile, mortgaged multiple property owners – including the cliched Mum and Dad investors – remain a solid presence too. But although more favourable tax settings and lower interest rates are benefitting them, there are challenges too, such as flat to falling rents, higher operating costs (e.g. council rates and home insurance), and perceived political risk.
Indeed, in an election year, capital gains tax and interest deductibility discussions will be important things to keep an eye on. The debt to income ratio limits are lurking in the background too.
Don’t ignore inflation but economy not fully recovered yet either
In thinking about the rest of the year, some fears about a higher OCR and rising mortgage rates have arisen from the above-target CPI inflation result for Q4, of 3.1%. That shouldn’t be ignored, but there’s no need to panic either. The labour market is yet to turn around to any great degree and spare capacity in the economy should bring inflation back down again soon.
In turn, while the OCR may rise prior to the previously expected timeframe of early 2027, those shifts are still not imminent. A rise in property sales of 10% still seems on the cards this year, with national median values rising by perhaps 5%.
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!
