“This shift partly reflects conscious lifestyle choices - such as travelling, building careers, or starting families - but housing affordability remains a key factor,” Westpac senior economist Satish Ranchhod said.
“Even with prices well below their 2022 peak, getting on to the property ladder still takes time, especially in larger centres like Auckland where prices tend to be higher.”
Ranchhod said there were trade-offs with first-home buyers getting on to the property ladder later in life.
“When people are waiting longer to get into the market, it does mean that potentially they’ve got fewer working years ahead of them to pay down any borrowing that they take on.
“But that’s balanced against the fact that, by waiting a bit longer, potentially they’re getting into the housing market when they’re further along in their careers, potentially their incomes are higher, and they may have a slightly higher deposit.”
Ranchhod said first-home buyers were now more likely to have children when buying than in the past.
“That can have important implications for the type, size and locations of homes they choose, as well as the time it takes to repay any borrowing.”
Rise in first-home buyers
The report shows the number of first-home buyers has picked up in recent years, accounting for nearly 25% of all property purchases nationwide between January and April this year.
This was well above the long-term average of 21-22%, the report said.
“The big drop in interest rates over the past year has been a key factor that’s helped more New Zealanders into their first home,” Ranchhod said.
“Fixed mortgage interest rates are now around 170 to 200 basis points (bps) lower than this time last year. For those buying an average-priced first home, those lower interest rates could cut their monthly mortgage costs by around $800.”
The report also highlighted that first-home buyers were currently getting more bang for their buck.
More than 75% of first-home purchases this year have been standalone houses – the highest share since 2020.
The median price paid has held steady at $700,000, unchanged for the past two years and lower than 2022’s $719,000.
Cotality chief property economist Kelvin Davidson said that, while first-home buyers might be older, they were entering the market with a clear plan and strong decision-making.
“They’re capitalising on their ability to tap into KiwiSaver, abundant listings, modest price growth and accessible finance to secure better homes in many cases.
“Making full use of the low-deposit lending allowances at the banks is another support for first-home buyers.”
Cameron Smith is an Auckland-based journalist with the Herald business team. He joined the Herald in 2015 and has covered business and sports. He reports on topics such as retail, small business, the workplace and macroeconomics.
