Standalone homes lead patchy housing market recovery

More than half of NZ suburbs are seeing house price growth, but townhouses are missing out

Standalone homes lead patchy housing market recovery

New insights from Cotality NZ's latest Mapping the Market report suggest standalone houses are inching ahead in New Zealand’s stabilising property market, especially in lower-cost suburbs. Meanwhile, townhouses and flats continue to lag. 

This is in line with Cotality’s May 2025 data, which showed buyers in urban centres favouring standalone homes over apartments. 

The suburb-level data offers one of the clearest signs yet that the market downturn may be in the rearview mirror, with affordable detached homes gaining traction among buyers once again. But experts warn this recovery is far from even, with affordability pressures and debt rules likely to keep things choppy into 2025. 

Growth for detached homes 

According to the data, 62% of suburbs -1,652 out of 2,661 - recorded flat or rising median values for standalone houses over the three months since March. And in 22% of those, values rose by 2% or more. 

Regional and affordable locations were among the top performers. Elderslie (Waitaki), Ngataki (Far North), and Evansdale (Dunedin) each posted value gains above 5%, with median house prices still sitting below $650,000. 

City suburbs also featured on the leaderboard. Kelburn in Wellington was up 4.1%, Temple View in Hamilton grew 3.0%, and both Little River near Christchurch and Bethells Beach in Auckland saw a 3.0% lift. 

Cotality NZ chief property economist Kelvin Davidson (pictured) said these early signs of growth are being driven by a mix of improving affordability and stabilising interest rates. 

“We’re seeing some green shoots across the board,” he said. “But standalone houses are perhaps tending to lead the early recovery in terms of both consistency and scale of value gains. More affordable detached housing seems to be appealing to buyers again, supported by easing mortgage rates.” 

Townhouses slower to rebound 

While standalone homes are regaining some ground, the recovery for townhouses and flats is more muted. Just over half of suburbs (54%) saw prices hold or rise, and only 16% recorded growth of 2% or more. The top-end rises were more scarce - only 43 suburbs showed increases above 5%, and just 12 managed to beat the 7% mark. 

Among them were North West Bay (Marlborough), Whangarei Heads, and Waikouaiti near Dunedin (up 6.8%). Chedworth in Hamilton (4.8%), Onetangi in Auckland (4.2%), and Eastbourne near Wellington (3.9%) also posted solid numbers. 

Still, the picture remains patchy. Forty-two (42) suburbs recorded value declines of 3% or more for townhouses, including Poike (Tauranga), Wakari (Dunedin), and Pukete (Hamilton). 

Davidson noted that these uneven results are likely tied to both supply-side dynamics and buyer behaviour. 

“Townhouses and flats aren’t falling away, but haven’t risen on such a widespread basis yet either,” he said. “In some locations, such as Auckland, this will more than likely reflect the large pipeline of new developments.” 

The takeaway for borrowers 

While the signs of recovery are welcome, Davidson notes that the overall environment remains uncertain and “sluggish”.  

For adviser clients debating on whether to take bets on further rate cuts or price falls, the key message is that - barring some major upheaval - we are not likely to see any significant tumbles. 

“Waiting for little bits and pieces here and there - rate cuts, further falls in house prices - sure, you might do better in a few months or in a year, but that’s uncertain,” Davidson told NZ Adviser. “If you have the finance now and a house you like, then that’s your decision to make.” 

“Certainly, the biggest falls in prices are behind us,” Davidson added. 

“We’re already 15-20% below the peak, and it’s hard to imagine that continuing significantly further. We’re just in this sluggish period where the fall has finished, but there’s no new boom starting. It’s definitely a ‘holding period’ for the property market for now.” 

And for those entering the market for the first time or looking to owner-occupy, Davidson added that the personal aspects of purchasing shouldn’t be lost. It can be easy to get caught up in comparing rates or watching for price dips, but as a significant life decision, it all comes back to the basics. 

“Ultimately, if you like the house and the location and you have the finance - you could wait too long and end up doing nothing!” he said. 

“Of course, the financial side really matters. But from a personal perspective, I would hope that people take the non-financial side into account too. That means buying something you like, where you can see yourself staying.”