Auckland's housing market went through a downturn in 2024, yet one of its grandest homes at 95 Victoria Ave in Remuera still managed to sell for $20 million.
Auckland's housing market went through a downturn in 2024, yet one of its grandest homes at 95 Victoria Ave in Remuera still managed to sell for $20 million.
House prices have fallen 5% since February
Analysts suggest house prices could rise in 2025
The most expensive homes in the country are in Auckland’s Herne Bay, which has a median price of $3.57 million
Optimism over the Government’s investor-friendly policies even led some property pundits to last year predict house prices could jump by 10% in 2024.
But things changed as job losses and high interest rates set in, analysts CoreLogic said in their new year-in-review report.
Since February, national house prices have fallen 5%, with Auckland and Wellington among the worst-hit regions, CoreLogic’s chief property economist Kelvin Davidson said.
“It’s clear in hindsight that the growth in property values over the first few months of this year was sentiment-driven off the back of the election in late 2023.
“Once it became clear that interest rate cuts were unlikely until the second half of the year and as labour market confidence dipped, so, too, did property prices.”
Looking ahead into 2025, however, the market could be at a turning point.
Davidson called 2025 the year of “conflicting forces”, saying there was room for optimism and caution.
On the one hand, interest rates have been falling in recent months and are tipped to fall further early next year as inflation appears to have been brought under control.
That could lead to interest rates of 5.5% or lower, bringing much-needed relief to homeowners struggling to pay mortgages and giving confidence to the wider economy, Davidson said.
On the other hand, job losses are expected to continue rising through until the middle of next year, he said.
The image shows the New Zealand suburbs that have grown the fastest and slowest over the past year and also the past five years as recorded by CoreLogic's Best of the Best 2024 year in review report. Photo / Supplied
Fear of losing jobs could stop families from going ahead with house purchases, something that could stifle house price rises by reducing buyer demand.
Davidson’s team was ultimately tipping house prices could rise by about 5% next year and there would be more activity in the market, with about 10% more homes being sold.
2024’s highlights
While 2024 was a tough market for investors and home sellers, first-home buyers welcomed the falling house prices.
They were able to snap up 27-28% of all homes sold during the year — a record-high share, Davidson said.
There were also many homes that sold for huge sums, making 2024 a memorable year for the sellers.
A grand mansion at 95 Victoria St in Remuera fetching $20 million sold for the highest price of the year, according to CoreLogic’s records.
The former home of Sir John Key on St Stephens Ave in Parnell sold for the next highest value at $16.3m, according to CoreLogic.
Yet while that is a big sum, the seller originally paid Key $23.5m for the house, meaning they made a $7.2m loss on a home they reportedly never got to live in.
The image shows the New Zealand suburbs with the fastest and slowest growing rents over the past years as well as the suburbs where homes have been selling quickest and slowest, according to CoreLogic. Photo / Supplied. Photo / Supplied
It appears that while the sale was agreed in 2023, the settlement only cleared during this year.
Elsewhere, homeowners in Herne Bay were also winners as the median value of a house in the Auckland suburb was the highest anywhere in the country at $3.4m — a 4% jump on last year.
South Island suburb Blaketown in Greymouth and Kaikoura on the east coast were the places where prices rose fastest during the year at 17% and 13% respectively.
Meanwhile, prices fell fastest in the town of Mataura in Gore, dropping 10%.
However, that made Mataura one of the best places for investors to buy as it returned the highest gross rental yields at 11%, CoreLogic said.
