Feature article

First home buyers hit record highs as national property values dip -0.2%

While investors are tapping the brakes, first home buyers are accelerating.

By Kelvin Davidson (Chief Property Economist, Cotality)

Last updated: 6 July 2026 | 4 min read

AI summary

A clear divide is emerging in the NZ property market. First home buyers (FHBs) have reached record market share, taking advantage of a sluggish market where values dipped -0.2% in June. Many are using KiwiSaver and low-deposit loans to enter the market.

In contrast, investors are pausing ahead of the election, wary of potential tax changes. While Cotality notes a recent peace deal could spark modest growth, a new property boom remains unlikely.

If you’ve been keeping one eye on the upcoming election and the other on global headlines, you might be wondering how all this uncertainty is playing out in the property market.

The short answer? A clear divide is emerging. While investors are tapping the brakes, first home buyers are accelerating.

Kelvin Davidson, Chief Property Economist at Cotality, unpacks the June numbers and explains how geopolitical shifts and election jitters are reshaping the Aotearoa housing landscape.

A sluggish June offset by a new peace deal

The latest Cotality Home Value Index showed a quiet start to winter, with national values edging downwards by -0.2% in June. This slight dip was primarily driven by the larger markets of Auckland and Wellington.

"It’s likely that the ongoing Iran-related uncertainty and previous increases in mortgage rates have kept values subdued in recent months," explains Kelvin. Furthermore, the supply of listings on the market remains elevated, which continues to give buyers the balance of power, "although sellers aren’t really having to settle for less either."

However, the landscape is shifting fast.

"Of course, more recently we’ve had the really encouraging news of the US-Iran peace deal, with fuel prices having fallen sharply and some banks even lowering mortgage rates too," he notes. "Clearly, if the deal holds, this could set the scene for some degree of housing growth later in the year – both in terms of sales volumes and property values."

Before you expect a massive surge, Kelvin warns that a "new boom seems unlikely." Job security always plays a role in housing trends, and he points out that there doesn't seem to be much prospect of a meaningful fall in the unemployment rate until we get into 2027.

First home buyers hit record highs with low deposits

While current owners and vendors might be feeling disappointed, it remains a highly favourable time to be a purchaser. First home buyers (FHBs) are seizing the moment, with their market share having reached new record highs recently.

"Strong supports for FHBs include access to KiwiSaver for at least part of the deposit and also the low deposit lending allowances at the banks," says Kelvin.

In fact, the data shows that more than half of all FHBs have recently been buying their homes with less than a 20% deposit. For many Kiwi, getting a foot in the door with a smaller upfront chunk of cash is proving to be a highly effective strategy in this sluggish market.

Election jitters put investors on pause

On the other side of the fence, mortgaged multiple property owners—including Mum and Dad investors—are taking a much more cautious approach.

With the election drawing closer, Kelvin observes that these buyers are "starting to bide their time."

They are facing a trifecta of headwinds right now: weak rents, higher operating costs, and the looming "risk of increased taxes after the election," such as a potential Capital Gains Tax (CGT) or changes to interest non-deductibility rules. Until the political dust settles, investors appear happy to sit on the sidelines.

Author

Kelvin Davidson

Chief Property Economist, Cotality

Chief Property Economist, Cotality - cotality.com Kelvin joined Cotality (previously CoreLogic) in March 2018. He brings with him a wealth of experience, having spent 15 years working largely in private sector economic consultancies in both New Zealand and the UK.

In his role with Cotality, Kelvin’s focus is on keeping up to date with what’s going on in the property market and continually finding different ways for viewing and interpreting it. Kelvin’s economics background means that he knows his way around a spreadsheet, but more importantly he always puts more emphasis on providing the key insights and telling a story.