Wellington house prices slump 30% from peak, QV says

Wellington house prices are now up to 30% below their peak. Photo / RNZ, Reece Baker

By Susan Edmunds of RNZ

Wellington house prices are now up to 30% below their peak, as the housing market continues to record a steady slide, QV says.

It has released its latest data, which shows the QV House Price Index fell 0.8% in the three months to the end of August.

The new national average value of $906,977 is 0.2% higher than the same time a year earlier but 13.4% below the January 2022 peak.

In the quarter, Queenstown was up 2.5%, and Hastings 1.7%. But Nelson was down 3.2%, and Wellington 2.4%.

Auckland, Whangārei, Hamilton, Napier, Palmerston North, Christchurch and Dunedin also recorded drops.

Spokeswoman Andrea Rush said Wellington values were now close to 30% below their peak and Auckland’s were down 20%.

The experience varied within each city.

In Auckland, Rodney had a smaller drop of 12.5%, with average values falling from $1,411,162 to $1,235,103. By contrast, Waitākere dropped 21.7% from $1,215,527 to $951,690.

In the capital, the steepest drop was in Wellington City - West, where average values fell 29.9% from the peak from $1,442,657 to $1,010,714. Lower Hutt also had significant declines, with average values down nearly $300,000 from $1,032,527 to $741,841 over the same period.

“The good news is that with home values coming down and interest rates beginning to ease, affordability is slowly improving for buyers in many areas. However, higher living costs, rising unemployment, the broader economic downturn, and stretched household budgets continue to restrict demand,” Rush said.

“Net migration has slowed sharply since the post-pandemic peak, with more people now leaving New Zealand than arriving, in contrast to the strong inflows that helped to fuel house price growth.”

Rush said the market was flattening or falling in almost every area, apart from Queenstown.

“The Queenstown Lakes District has not dropped back at all and in fact is nearly 17% up over that five-year period and also neighbouring area Mackenzie District is showing one of the largest increases of nearly 6 % … that sort of spreading out to Twizel and Fairlie, in those areas, is potentially people priced out of the Queenstown Lakes area, looking at lakeside holiday homes.”

She said the construction sector in Queenstown was still busy.

“There’s a lot of residential developments going on … some of the bigger infrastructure projects coming on stream and there’s a sense that things may pick up in terms of the construction industry.

“But in 2026, I think some of the headwinds that the housing market has seen will continue. The higher living costs, the rising unemployment, the broader economic downturn, stretched household budgets, the sort of migration going the other way, there’s fewer people coming in now than are leaving.

“So all of those things will probably mean that things remain relatively subdued. But we also have obviously interest rates that are tracking down. So it’s going to be interesting as spring comes along to see what happens in the housing market in terms of next year. It’s probably a little too soon to tell.”

-RNZ