Where is the NZ and Christchurch property market headed this year?

We felt like frogs in a pot of hot water, not really knowing if we were heating up or not…until all of a sudden! 

Just this last week, we saw 5 properties go under offer, two settlements and one confirmation. 

All signs are pointing to a resurgence in positive sentiment and the market is undeniably gaining momentum.

There was a while there where we’d look at each other in the office and think…’well, that’s it, people don’t want houses anymore, we’re off to get jobs at the traveling circus.’ 

In reality, we’re a small boutique company so the slow down didn’t really rock us. 

We bobbed around the waves like the small (but nicely designed) little boat that we are. 

It can be tough being in such a market driven industry but we keep reminding ourselves; we build quality homes, in a city that is growing in population and popularity - it should be like shooting fish in a barrel! 

But we acknowledge that property is indeed cyclical and there will be slow times as there will be good times. 

It’s just nice to know which part of the cycle you’re in and what to expect for the 12 months if you’re thinking of entering the market. 

To help with that potential decision, we’ve done a bit of a deep dive into where we foresee the market heading.

We’ve kept it punchy to get across some of the key indicators that are helping the Garden City stay strong.

Christchurch's Unique Position vs WGTN & AKL

We may be the 2nd biggest city but we’re always drawn third in market chat (frustratingly) but, we beat our more expensive neighbours over the past few years - well, beat as in, didn’t nose dive as bad…

Auckland: property values down 22.3% from the peak to January ‘25, 

Wellington: property values down 24.9% from their peak with elevated stock levels

Christchurch: recorded more modest falls of 6.8% for the same period.

Pretty clear to see why buyers have been cautious over the last few years, buying in these markets can be a little like catching falling knives. Buyers prefer to see bar charts like the CoreLogic one above, flipped the other way around!

These price drops were mainly driven by rising interest rates after an insane period of cheap capital that lit a fire under the property market for a while post-covid.

As borrowing costs increased, buyer activity slowed, leading to some pretty sharp price corrections. Many developers planned stock for the market they were currently in (think 2 bed no carpark) as anyone was buying a property based purely on affordability rather than value. Crazy times there were.

However, as of the past few weeks we’ve seen OCR and interest rate cuts and at the coal face we can feel the market sentiment improving. 

For the rest of this year we’re expecting a gradual recovery, nothing too wild, just some nice steady, stable growth especially here in Christchurch.

Hedging In The Garden City

Back in May ‘22, we wrote about Christchurch being a ‘hedge city’ for investors - those who diversified their portfolios by adding Christchurch would have avoided some of the capital losses seen elsewhere.

So, why has Christchurch stood tall? It's all about supply and demand working together:

• Post-earthquake rebuilding and greenfield developments have added thousands of new homes
• Building momentum continues with 3,766 new consents issued last year (up 6.7%)
• Christchurch accounted for roughly 18% of all NZ home sales in 2024

Christchurch remained its resilient self due to a steady supply of new housing and balanced demand, preventing the extreme price swings seen in other major cities. Unlike Auckland and Wellington, where volatility and speculation played a bigger role, Christchurch's affordability, sustained population growth, and ongoing development have created a more stable and predictable market for both homebuyers and investors.

The Affordability Advantage

One thing that makes Christchurch special is our affordability. About 60% of homes sold in 2024 went for under $700k, with median prices sitting around $650k-$750k.

This affordability is drawing in:

• First-home buyers who can actually get into the market
• Families looking to upsize
• Migrants (both from within NZ and internationally)

Local developers like us are seeing strong demand for family homes, which is why we're scaling up our land purchases to meet this need. We’ve got a stunning array of 3 bed 2 bath, standalone offerings complete with garaging in the pipeline (ask us nicely, we may tell you the locations before we release them to joe public…)

So, What's Coming Next?

This year won’t go setting any sales record, and the capital gains rocket ship won’t be off to the moon any time soon - but growth will be slow and steady and more of what we’re used too (and we prefer it like that, 2021 and the year leading up was crazy, people made some poor buying decisions and shi**y properties were selling, as they say, even a turkey can fly in a tornado). We reckon;

• Continued, but gentle price growth (likely 3-4% annually)
• Strong demand for entry-level and mid-range homes (sub-$800k)
• More development confidence as mortgage rates continue to fall
• Demand to be keeping up with supply but not outpacing
• Focus on quality - location, build and value (the trifecta all buyers need)

Net Migration Still Strong

Christchurch had a solid bump from net migration (both internal and some international) as people moved to the revamped city for decent jobs, better lifestyle and much cheaper housing. QV’s local valuers say that ‘increasing new migrants to the region’ is bolstering the housing demand and they expect 2025 will see further value growth as a result​. Good news for the city and another growth indicator.

The Developer View

From our perspective at Rosefern Homes, we're positive about the next few years and we’re seeing a few indicators help the market in general;

1. Interest rates are dropping, making housing more affordable for buyers
2. The new government has signalled support for housing development
3. The city is growing in a sustainable way with room to expand both outwards and upwards
4. Major infrastructure investments (metro sports facility, Te Kaha stadium) are making the city more attractive

As we take off our Rosefern tinted glasses and look through the lens of a buyer, we see great opportunity. 

The city once known for the ‘rebuild’ is no longer just a ‘rebuild’—it’s a regeneration and a revival. Christchurch has moved beyond recovery and into a phase of reinvention, evolving week by week and leaving a lasting impression on both visitors and new residents.

The Buyers Time…

For buyers, the tide is turning but the waters are still calm enough to navigate without the panic and FOMO of previous years. With interest rates descending finally and more properties on the market, buyers now have choices and a bit of breathing room to make smarter decisions. The days of throwing in an offer just to "secure something" are over. Instead, quality, location, and value matter more than ever.

With property, everything is looking around the corner - but the key indicators we can see are pointing us in the right direction. The industry has had a good shake up - we want quality homes that represent value. If the developers haven't listened to that market feedback and continued with - just build and they’ll sell, they might get flushed out - which is sad to see but also happens in a cyclical industry! 

We hope this has given you a bit of an idea from the coal face of how the market is shaping up - and all things point to positivity. So go forth, find some cracking deals and get set up for a better future.