Source: Radio New Zealand
123RF
How much are first-home buyers paying to get into the market now?
First-home purchasers have been responsible for a large share of property transactions in recent years, and new research from Cotality and Westpac shows that continued through the start of this year, too.
Over the past year, first-time buyers have purchased 24,800 properties – the highest annual number since the year to the third quarter of 2021.
“Whether you look at absolute numbers or relative share, it’s all pretty positive,” said Cotality economist Kelvin Davidson.
He said people were also getting more house for their money.
More than 75 percent of purchases were of standalone houses, and the median price paid was $720,000.
“The median price so far has gone up to $720,000 from $700,000 last year but that’s not a big increase… there’s a rising share of standalone houses among first-time buyer purchases. They’re getting bang for their buck in a market that’s titled in their favour with lots of listings, house prices down, interest rates lower than they were a couple of years ago.”
But there was a lot of regional variation within that number.
The highest median price paid by first-home buyers was $900,000 in Auckland, was followed by a median $733,000 in the Bay of Plenty and $730,000 in Wellington.
The lowest median was $407,500 on the West Coast and $489,000 in Southland. In Canterbury, they paid $655,000.
“In a provincial market what first-home buyers are buying is pretty representative of the houses that exist. A lot of first-home buyers in rural areas would be buying three-bedroom standalone houses. That’s what’s there but there would be differences in other markets such as Auckland where there’s a broader choice.”
Davidson said in the middle 40 percent of the market by price, first-time buyers were responsible for about 30 percent of purchases, compared to 21 percent in 2015.
The median price for first-time buyers was significantly higher than the lower quartile price for all buyers, of $600,000. “The ‘typical’ first-home buyers doesn’t always enter at the bottom of the market and work their way up. Many actually enter the market well above the lowest tiers of the ladder.
“There’s actually pretty strong data that a lot of them enter halfway up the ladder.. the median price being paid by first-time buyers is a long way above the lower end of the spectrum across all buyers.”
In many cases, buyers were taking out loans with deposits of less than 20 percent. Westpac said its record showed the average loan-to-value ratio for first-home buyers was 81 percent, up from less than 77 percent in 2024.
Davidson said KiwiSaver was a big help for most buyers.
Lower interest rates were also helping. In most parts of the country (excluding Auckland), minimum mortgage payments are now around $130 a month lower than they were this time last year, and $820 a month lower than they were back in 2024.
In Auckland, where first home prices tend to be much higher, the fall in mortgage costs has been even larger. Minimum mortgage payments are now around $180 a month lower than they were this time last year, and they’re around $1100 lower than they were back in 2024.
The calculation was based on an average price first-home with 90 percent deposit fixed for one year with a 20-year loan term.
Davidson said many of the supportive factors for first-home buyers were likely to remain in place.
“Reduced interest rates, KiwiSaver, loan-to-value allowances… it doesn’t look like house prices are going anywhere either. Mortgage rates are creeping up, so that’s a consideration for would-be first time buyers. But I think the buying window that’s been open for quite a long time now… is probably still going to be there for a while if house prices sort of stay broadly flat and the LVRs stay open.”
He said people who could cope with interest rates pushing up a bit and who were confident in their jobs would see opportunities.
“There are a lot of listings out there. Sellers are willing to do a deal to keep moving on. So I think first time buyers have things in their favour for a little while yet.”
Median first-home buyer price – Q1 2026
- Northland: $615,000
- Auckland: $900,000
- Waikato: $695,000
- Bay of Plenty: $733,000
- Gisborne: $600,000
- Hawke’s Bay: $625,250
- Taranaki: $560,000
- Manawatu-Whanganui: $524,000
- Wellington: $730,000
- Tasman: $712,000
- Nelson: $629,500
- Marlborough: $585,000
- West Coast: $407,500
- Canterbury: $655,000
- Otago: $620,000
- Southland: $489,000
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand