‘Steady’ OCR call provides platform for housing market rebuild
Wednesday, 18 February 2026
The Reserve Bank’s decision to hold the OCR at 2.25% is being welcomed as a steady hand for a housing market that is only just beginning to stir.
With inflation still sitting above target but the broader economy showing signs of stabilising, real estate experts say keeping rates unchanged provided much-needed certainty for buyers and sellers as activity slowly lifted.
Ray White New Zealand chief executive Daniel Coulson said the decision to hold the OCR was a constructive signal for the economy and the housing market.
“It reflects growing confidence that inflationary pressures are moderating and that economic conditions are beginning to stabilise,” he said.
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“Importantly, it also suggests the bank is comfortable enough has been done to slow demand, without unnecessarily constraining momentum as confidence starts to return.”
In the housing market, prices have remained subdued, and sales activity slowed again at the start of the year, the latest data from Cotality and the Real Estate Institute shows.
But Coulson said the market was showing early but encouraging signs of renewed energy.
“Buyer inquiry has lifted, clearance rates have improved, and decision-making timelines are shortening.
“For many buyers, this period may represent the best balance point. The last opportunity to take advantage of today’s interest rates while prices remain below their previous peaks.”
While affordability and cost-of-living pressures remained front of mind for many households, a steady OCR provided a platform for confidence to continue to rebuild through 2026, he said.
LJ Hooker head of operations NZ Allaine Burkett said flat pricing conditions were being offset by a gradual lift in sales activity.
“What we’re seeing on the ground is a market that’s slowly waking up,” he said. “Buyer confidence isn’t rushing back, but it is improving, particularly as mortgage rates remain lower than they were a year ago.”
While market conditions were gradually improving, Tiller said the Reserve Bank’s cautious stance meant any recovery was likely to be measured rather than rapid.
“Lower interest rates and improving sales volumes should provide support, but confidence will rebuild gradually rather than all at once.”
For Realestate.co.nz chief executive Sarah Wood the key takeaway from the OCR call was ongoing market stability.
“Some predicted there would be a bit of a new year boom, and that has not transpired,” she said.
“Real estate agents tell us they are busy, but would like to see more sales as the year progresses. What we are seeing is a stable market.”
The OCR remaining at the same level provided certainty for property buyers and sellers, she said.
“When buyers know what they will need to pay with a purchase, and sellers know what sort of prices they can expect it makes it easier to transact.
“In turn that makes for an a more predictable and stable market, and that is good to see heading into an election.”
Cotality chief property economist Kelvin Davidson said it remained a case of waiting to see how conflicting forces played out for the housing market.
While banks had pushed small moves in some mortgage rates lately, rates remained fairly stable and much lower than before, and that would be supporting sales activity and prices, he said.
“In contrast, a cautious attitude still prevails across the market, and it’s difficult to see a sharp turnaround for activity or prices until jobs growth picks up and the unemployment rate falls more emphatically.”
That looked set to be a story for later in 2026 rather than sooner, Davidson said.
‘The Reserve Bank itself predicts that prices could fall a bit further in the next three to six months before edging higher later this year.
“They could end up flat for 2026 as a whole and only rise by 3.0% in 2027.”
Based on the recent rise in housing stock versus population, and the new restraint of debt to income ratios, it was hard to disagree with those modest expectations, he said.