Not Out of the Woods Yet, But Signs of Optimism Emerging in Property Market

Auckland, September 2025 – The latest data and market insights suggest that while challenges remain, there are encouraging signs of renewed momentum in the New Zealand property market.

An extract from the REINZ Property Report (September) highlights the cautious but shifting sentiment:
“Market sentiment was influenced by buyers adopting a wait-and-see approach, lower interest rates, and increased buyer caution. Local salespeople are cautiously optimistic that there will be incremental improvements over the next few months. However, they mention that it much depends on factors like the job market, and further OCR reductions.” – Lizzy Ryley, Chief Executive AREINZ.

Interest Rates and Economic Signals

“Predictions are that there may be further OCR cuts before the end of this year,” says Daniel Horrobin, Director of City Realty Group, “with two more announcements planned for 8 October and 26 November. As more borrowers come off fixed terms and begin to benefit from lower rates, we hope to see more disposable income filter into the economy, with confidence in the property market lifting alongside.”

Fresh economic data reinforces this. The NZ Herald reported a 0.9% fall in GDP, well beyond Reserve Bank forecasts. Economists now believe this could trigger sharper OCR cuts than previously expected.

Meanwhile, Realestate.co.nz reported a boost in supply and buyer activity in August, with over 8,500 new listings added – up 9% year-on-year – supported by another OCR cut.

Activity Across City Realty Group

“Activity-wise across our Group, open home statistics for August were extremely encouraging,” Horrobin reports.

769 Open Homes conducted in August – up 54.2% from July

452 properties opened to the market – up nearly 60%

504 buyer attendees recorded – a 33.3% increase month-on-month

Central city apartment market alone saw 529 Open Homes (+66.3%), drawing 239 buyers (+57.2%)

On the auction floor, August ended with strong results.

A Princes Wharf penthouse donated to Auckland University sold for $750,000 – $200,000 above the pre-auction offer – sold by the University to fund seismic engineering research.

A dual-key apartment in Whitaker Place attracted five bidders and 36 bids before selling under the hammer.

“These results send a strong message to those waiting on the sidelines for the market to improve,” says Horrobin.

Rental Market Shifts

Data from the Ministry of Business, Innovation and Employment shows the national median rent in the three months to May fell 0.3% year-on-year, the first decline since 2009. In Auckland, rents fell 2.0%, reflecting weaker tenant demand, while net migration gains in the 12 months to July dropped by 91% compared to two years ago.

Looking Ahead

“Predicting the future is challenging,” Horrobin notes, “but the long-term indicators give cause for optimism.”

Economist Tony Alexander, writing in NZ Herald OneRoof (17 September), noted that while many businesses misjudged 2025 as a “booming year,” survey results suggest confidence is shifting toward 2026.
He also emphasised the timing lag of interest rate changes:
“It can take 18–24 months for higher interest rates to deeply affect the economy, and a similar period for falling rates to flow through. Rates have now been declining for 13 months, so we are getting closer to seeing greater willingness to spend.”

Final Word

“We’re not out of the woods yet,” concludes Horrobin, “but there are encouraging signs we’re heading in the right direction.”