The change has been observed across most of the country’ s major urban centres, although the broader Wellington region— including the city itself, Lower Hutt, Upper Hutt, and Porirua— remains a notable stronghold for FHBs.
In this region, their market share was 35 per cent in Q1, reflecting Wellington’ s relative affordability. Driven by softer property values, this supports resilience, provided prospective purchasers feel secure in their employment.
THE INVESTOR COMEBACK
While lower mortgage lending rates over the past six to nine months, falling from greater than seven per cent to below five per cent, have benefited all borrowers, it’ s mortgage investors who seem to be reaping the greatest rewards.
In particular, smaller‘ Mum and Dad’ investors are re-entering the market, many of whom are drawn to existing properties.
“ The comeback has been powered by‘ Mums and Dads’,” says Kelvin Davidson, CoreLogic New Zealand’ s chief property economist.
“ The comeback has been powered by‘ Mums and Dads’”
“ Mortgaged MPO-2s – those who own two properties after their latest purchase – have risen from six per cent of activity in mid-2023 to eight per cent now, while MPO 3- 4s have climbed from a trough of four per cent to around six per cent.”
This group’ s resurgence is aided by a combination of factors: a reduction in deposit requirements( from 35 per cent to 30 per cent), a shorter Brightline Test, and the full reinstatement of mortgage interest deductibility.
Davidson says that most impactful, however, is the reduction in the“ top-up” required from investors’ other income to cover rental property costs.
“ When mortgage rates were over seven per cent, these topups could exceed $ 400 / week. Now, they’ re closer to $ 200. While still a commitment, this lower barrier entices new investors back into the market.”
SHIFTING AWAY FROM NEW-BUILDS
There’ s been a subtle cooling in investor demand for newbuild properties. In 2023, mortgage investors made up 30 per cent of buyers in this segment. That dropped to 29 per cent in 2024 and has now slipped to 27 per cent in 2025.
This decrease is consistent with changes to tax settings. Previously, existing properties were disadvantaged by higher tax burdens, but now that mortgage interest deductibility is equalised, the incentive to favour new builds has diminished.
At the same time, high listing volumes give investors ample choice in the existing property market, potentially at better prices.
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