New Zealand Housing Market: A New Normal

New Zealands housing market has experienced a dramatic boom and bust, leaving many citizens and investors feeling uncertain. The economy has struggled as a result, with a contraction in three of the last five quarters. The current slowdown stems from a decade-long affordability crisis that peaked during the pandemic, causing house values to soar by about forty percent in an eighteen-month period ending in November 2021. However, when the bubble burst, aggressive interest rate hikes and an increase in housing supply caused prices to fall by nearly twenty percent. This three-year decline is unprecedented for many New Zealanders who have seen average annual returns of roughly seven percent in housing over the last three decades. The market dynamics have shifted, with a different balance of supply and demand, and house prices predicted to rise by a modest five percent in both 2026 and 2027. With over half of New Zealands household wealth tied to property, this downturn has significantly impacted consumption and the broader economy.The Daily News Now! — Every city. Every story. AI-powered. Hosted on Acast. See acast.com/privacy for more information.