Kelvin Davidson: Cotality's Chief Property Economist on house prices falling 1% in 2025

New Zealand may be in for a more positive property market in the new year.

Cotality’s January Home Value Index shows that property values were down 1% in 2025 – a drop of 17% from the 2022 peak.

Regional performance varied, with Aukland and Wellington remaining weak, but Southland districts and provincial centres such as New Plymouth and Queenstown seeing increases.

Cotality’s Chief Property Economist Kelvin Davidson told Andrew Dickens that the reason they’re forecasting increases is because a number of factors that restrain house prices are starting to turn around.

He says mortgage rates are down, the economy is turning around, and unemployment should come down, which should give households a bit more confidence to act in the housing market.

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