When New Zealand’s property market feels a lot more buyer-friendly, with more listings, motivated sellers, and less competition in the market, it’s good news for First Home Buyers. They then have more choice, greater bargaining power, and a better chance of finding the right home without the same level of pressure.
From Past to Present
During the 2020/2021 housing boom, record low OCR and mortgage rates meant getting a mortgage was easier and repayments more affordable.
Driven by FOMO (fear of missing out), borrowers stretched their finances to the limit to buy property. As a result, prices shot up more than 30% in just one year!
By late 2021, inflation peaked at 7.3%, forcing the Reserve Bank of New Zealand to raise the OCR to 5.5%, pushing one-year fixed rates near the 7.5% mark. The mood flipped to FOOP (fear of overpaying), and houses prices dropped nearly 17% nationally and up to 25% in places like Auckland and Wellington!
Fast forward to 2025, and conditions stabilised. The OCR eased back to 3.25%, bringing one-year fixed rates down to around 4.9%. With house sales picking up, and property prices showing modest growth, with First Home Buyers thriving.
First Home Buyers accounted for more than 26% of all property purchases in the second quarter of 2025, the highest share in years. With demand particularly strong in Wellington, Auckland, Hamilton, Christchurch, and Dunedin, where more First Home Buyers entering the market.
When the market shifts to be more in favour of buyers, the big question is, how do you get ahead as a First Home Buyer?
How to get ahead in a Buyers’ market
With more listings available, fewer investors competing, and interest rates settling at more manageable levels, First Home Buyers are in a strong position. Whilst property prices remain stable, it could be the perfect time to get into the market.
Some smart ways First Home Buyers can take advantage of a buyers’ market…
Take your time to negotiate
- Sellers are more motivated, and there’s less competition in such a market, so you’ve got time on your side and less pressure to put in conditional offers, or negotiate on price, settlement dates, or even inclusions like appliances or minor repairs.
Get Pre-Approved
- Having your finance in place before you even start looking for a property means you can move quickly when you do find the right one. With pre-approved finance, you can shop around with confidence, knowing exactly how much you can borrow.
Look beyond the hotspots
- With newer suburbs emerging, it’s worthwhile extending your property search. You may find hidden gems with potential for growth and future appreciation.
Factor in future affordability:
- Even though interest rates have dropped, they may not go much further and could even rise in the future. Calculate your mortgage repayments at slightly higher rates to make sure you can afford to manage your mortgage long-term.
Use government schemes:
- You may be eligible to receive government support, such as KiwiSaver Withdrawal, or First Home Loan. This can be a real boost for your deposit.
Finally, book in a chat with your iLender Mortgage Adviser.
Buying your first home can be overwhelming, but here at iLender one of our Mortgage Advisers will make the process easier. They will guide you through each step, help you understand your borrowing power, compare loan options from a range of Lenders, and explain the fine print in plain language.
So feel free to reach out if you need a hand making the right decision, or just to have a chat, pick up the phone and call 0800 LENDER (536337) or email to [email protected] and we will be delighted to be your Mortgage Adviser of choice.
