New Zealand’s housing crash deepens


The Real Estate Institute of New Zealand’s (REINZ) housing market results for January are out, with New Zealand’s housing crash continuing to deepen.

The REINZ’s House Price Index (HPI), which are based on sales which actually happened in the month (rather than title changes based on sales which happened potentially many months ago) and adjust for changes in the mix of dwellings sold from one month to another, fell another 0.2% in January to be down 13.9% year-on-year:

REINZ house price index

Values are now down around 15% from their November 2021 peak.


The bigger story is around sales, which plunged to their lowest level ever in January, excluding the 2020 pandemic lockdown period.

Only 2,759 residential properties were sold nationally in January, which was down 27% compared to January last year:

REINZ house sales

The number of days taken to sell has also ballooned to 53 days, up 16 days on a year earlier:

Days to sell

The outlook for New Zealand’s housing market is also grim, with inventory soaring by 60% or more across eight of 14 regions over the past year.


This is despite new residential listings falling 16% year-on-year.

Therefore, there are more properties available for sale but not much is actually selling.

Tony Alexander’s latest survey of New Zealand real estate agents showed that the majority (59%) of agents are still seeing home values fall in their areas of operation. Attendance at auctions continues to decline. And around two-thirds of buyers are concerned about prices falling after they make a purchase, alongside being concerned about rising interest rates and access to finance.

Given the Reserve Bank has explicitly forecast a further increase in the official cash rate to 5.5% (from 4.25% currently), alongside a recession, it is hard to see New Zealand’s housing market rebounding anytime soon.


This is especially so given most mortgage holders are yet to be impacted by the Reserve Bank’s aggressive monetary tightening, since most mortgages in New Zealand are fixed rate.

The situation will change this year with Westpac recently warning that “more than half of all mortgages will come up for re-fixing in the next twelve months, and many borrowers will face large increases in their debt servicing costs”.

Thus, if recession hits, there could be a wave of forced sales that pushes house prices even lower.

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.