2025: A year of strategic growth and market revival

As we settle into 2025, we're seeing early signs of cautious optimism in the New Zealand property market, and a subtle shift from the more reserved approach that characterised 2024.

There are several factors that we can expect to shape the year ahead. The full reinstatement of interest deductibility for residential property investors by April 1, 2025 will mark a significant milestone that will strengthen investor interest. This policy change, combined with improved conditions for house prices and household incomes, means we can expect a more attractive environment for both investors and homeowners.

While opportunities abound, it's important to note that we're still in a recovery phase. The market enthusiasm of 2021 is yet to return - and that's not necessarily a bad thing. The absence of the FOMO (fear of missing out) seen in the post-Covid years creates space for strategic buying decisions, particularly as some vendors adjust expectations.

Looking at the broader economic picture, consumer confidence is gradually returning, though buyers remain pragmatic. Savings have been impacted over the past two years, and investment decisions are being carefully weighed against job security and wage growth. However, this measured approach is contributing to a more sustainable market recovery.

From a regional perspective, Christchurch stands out as a particularly compelling market for 2025. Following years of post-earthquake rebuilding, we're seeing an influx of high-end homes entering the market as insurance settlements resolve. The city's evolution is particularly evident in the growing demand for inner-city living, with premium apartment developments currently in high demand.

Areas like Tauranga and Blenheim, which have been unusually subdued, are positioned for growth off a lower base, and the Southern Lakes region continues to demonstrate resilience and appeal, particularly in the premium segment.

Technology will continue to play its part in impacting our industry. We are already seeing this through tech’s ability to streamline transactions and improve marketing reach. These digital advances benefit both vendors and buyers.

At New Zealand Sotheby's International Realty, we're responding to these market opportunities with strategic expansion plans. Quality growth remains our focus in existing territories, while we're actively exploring new regions including Southland, Bay of Plenty, Dunedin, and additional Auckland areas. Our trans-Tasman presence is also set to grow, with our first Melbourne office opening in Toorak in Q1 2025 and plans for expansion into Hawthorn and Bayside.

While 2025 won't mirror the frenzied market conditions of recent years, it promises something potentially more valuable: sustainable growth underpinned by improving economic fundamentals and practical policy settings. For those looking to make property moves in 2025, the key will be recognising that while the market is recovering, it's doing so in a way that rewards strategic thinking over speculative buying.