Invercargill a property standout in a slow market

Wednesday, 10 December 2025

Invercargill has become one of the standout performers in an otherwise subdued national housing market, with two of its suburbs posting the fastest selling times in the country.

Cotality’s annual Best of the Best report of 2025 showed homes in Glengarry and Grasmere sold in a median of just nine days, far outpacing the national picture.

Two other Invercargill suburbs took out places in the top 10 - Strathern at eight and Gladstone at 10th.

Cotality NZ chief property economist Kelvin Davidson said affordability and the city’s strong links to the rural economy helped keep buyer activity brisk.

“Invercargill has generally been a pretty resilient market this year supported by affordability and a strong rural economy,” he said.

Meanwhile rents were also going up in Invercargill - up 18% in Gladstone, the highest increase in the country.

Nationally, the housing market in 2025 was shaped by conflicting forces, Davidson said.

Lower mortgage rates boosted sales volumes which are on track to reach around 90,000 for the year, he said.

“While lower mortgage rates and continued access to finance have supported buyers, the recovery has been significantly limited by other factors,” Davidson said.

“A sluggish economy and rising unemployment rate have weighed on the housing market, keeping the general value trend broadly flat across much of the country,” he said.

The South Island took out several of the hot spots - Greymouth had the highest five-year growth in 2025, at nearly 60% increase in median value since 2020.

This was closely followed by Christchurch’s Somerfield and Hokitika, both delivering gains of nearly 50% growth over the same five-year period.

Davidson said the majority of the highest growth suburbs tended to skew toward more affordable areas, encompassing rural locations, small towns, or lower-priced suburbs within larger main centres.

He pointed to declining net migration as a key drag on the national market, contributing to rent softening across major centres. Rents fell outright in Auckland, Wellington and Christchurch, creating challenges for investors but easing conditions for tenants.

While Invercargill homes moved quickly, many other markets saw extended listing times. Taumarunui, Opaheke in Auckland, and Twizel were among the slowest, with median days on market rising to 71.

Auckland continued to dominate the upper end of the market, taking eight of the top 10 spots for highest median values.

Herne Bay led the national list with a median value of $2.6 million, followed by Westmere and Ponsonby on $2.2m and Remuera on $2m. Arrowtown’s median value was $2m and Tamahere on $1.9m in Waikato were the only suburbs to make the top list outside of Auckland.

The report said at the other end of the spectrum, Wellington Central - with a high number of apartment dwellings - was the most affordable suburb with a median value of $318,706.

Davidson said lower value areas recorded the strongest five-year gains, with Greymouth leading a nearly 60% lift since 2020.

He said the coming election year would bring key policy influences, including debt-to-income caps, capital gains tax debate, and the ongoing effect of looser loan-to-value rules.

As the economy improves — with GDP growth expected to lift and unemployment forecast to fall — property sales are projected to rise to around 100,000 in 2026, he said.

Median values were tipped to grow by roughly 5% nationwide, he added.