The Latest on New Zealand’s Housing Market & Migration Trends

The latest View by economist, Tony Alexander (30 January 2025) highlights crucial shifts in New Zealand’s housing market, migration patterns, and economic outlook. If you're considering buying, selling, or investing, here’s what you need to know.

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1. Migration Slowdown & Housing Impact

New Zealand has seen a sharp decline in net migration, dropping from 133,300 a year ago to just 30,600. This shift is primarily due to a decrease in arrivals rather than an exodus of Kiwis. However, net Kiwi departures are rising, with 47,800 New Zealanders leaving in the past year, mostly heading to Australia.

What this means for the housing market:

• With fewer people arriving, demand for housing may weaken, particularly in urban centres.
• Rental demand could stabilise or soften, impacting investors looking for high rental yields.
• Property values in some areas could be more negotiable, favouring buyers over sellers.

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2. Tourism Boom: Is It Enough to Lift the Economy?The government is pushing for higher numbers of international tourists, shifting back to a quantity-driven strategy rather than a focus on high-spending visitors.What this means for the property market:

• Short-term rentals and Airbnb demand may rise, leading to higher rents and property prices in tourist-heavy areas.
• Increased tourism won’t necessarily boost average Kiwi incomes, as stated by MBIE.
• Infrastructure demands will increase, putting ratepayers under more financial pressure.

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3. Real Estate: Buyer’s Market & Flat PricesDespite previous optimism, buyer demand has softened.

• FOMO (Fear of Missing Out) has dropped to 11%—buyers feel less urgency to purchase.
• The market remains a buyer’s market, with sellers more motivated to close deals.
• Many expect interest rates to fall, but predictions remain uncertain.

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What buyers & sellers should consider:

• Buyers have more negotiating power—it’s a good time to look for deals.
• Sellers need to price strategically to attract serious offers.
• Investors should watch rental demand before making new purchases.

What’s Next for New Zealand’s Housing Market?New Zealand’s property market remains in a state of transition. While migration declines, tourism increases, and interest rate predictions remain uncertain, buyers and sellers must stay informed to make the best financial decisions.Want to know how these shifts impact you? Get in touch today!