Investors Are Back: Why Now Could Be the Smartest Time to Buy Property in New Zealand

With investors making up 25% of all buyers and interest rates dropping, now may be the perfect time to secure a property before prices rebound. Explore the latest NZ real estate insights.

A Turning Point in the Property Market

After a period of hesitation, signs suggest that confidence is returning to the New Zealand property market. While many buyers have been waiting for prices to fall further, new data shows that investors are stepping back in—seeing opportunity where others see uncertainty.

A recent report from industry researcher Cotality (formerly CoreLogic) reveals that “mum and dad” investors now make up around 25% of all buyers, signalling renewed confidence and a growing belief that the market may soon rebound. At the same time, first home buyers are becoming more active in the entry-level segment, indicating a broader shift in buyer sentiment.

Together, these trends suggest we may have entered the optimal window to buy.

Falling Interest Rates Are Fueling Activity

The Reserve Bank of New Zealand’s ongoing reductions to the Official Cash Rate (OCR) have played a major role in reigniting demand. Since June last year, the OCR has dropped by 3%, including a 0.5% cut last month, bringing it down to 2.5%.

This easing of rates has made borrowing more affordable, encouraging both investors and first home buyers to act sooner rather than later. The RBNZ has also signalled a willingness to adjust further, depending on upcoming inflation data—which recently came in at a manageable 3%, in line with forecasts.

Why Investors Are Targeting New Builds

According to Cotality, investors are particularly drawn to new homes, which remain exempt from Loan-to-Value (LVR) and Debt-to-Income (DTI) restrictions. These exemptions allow greater flexibility for buyers looking to secure lending at a time when credit conditions remain tight across the broader market.

Cotality’s Chief Property Economist, Kelvin Davidson, notes that lower interest rates have been the biggest catalyst for investor activity:

“The most significant change has been lower interest rates, reducing the cashflow top-ups that are generally required on a rental property purchase. Investors are hunting out some good deals in the current sluggish market.”

In short, investors are taking advantage of the current lull in prices to secure long-term value before the next upswing.

Market Performance and Regional Trends

While the national median price continues to ease, it’s important to note that declines are slowing. The latest OneRoof/Valocity housing report shows that the median home price fell just 0.8% last month, a modest $8,000 drop to an average of $957,000.

Out of 16 regions, six—Tasman, Southland, Bay of Plenty, West Coast, Hawke’s Bay, and Otago—recorded slight increases in value, each under 1%.

Auckland continues to show resilience despite fluctuations, with an average price of $1.26 million, still $316,000 below its January 2021 peak—an indicator that there’s still room for growth once confidence returns.

The Bottom Line

The combination of lower interest rates, renewed investor confidence, and stabilising prices suggests that the market may be nearing a turning point. Those who have been waiting for the “perfect moment” might find that moment is now.

As more investors and first home buyers return to the market, competition is likely to increase—potentially pushing prices higher again in the near future.

If you’re considering buying or investing, acting while conditions remain favourable could be the key to getting ahead of the next rebound.