In our recent discussion with Adam Farrell, Lighthouse Property Director, we unpacked the smart data property investors are following and why looking beyond the headlines matters. Rather than reacting to market noise, the conversation focused on the indicators that could provide a clearer picture of where New Zealand's property market is heading.
The Smart Data Property Investors Are Following Starts With Confidence
Not every market indicator tells you what’s happening today. Some provide insight into where confidence could be heading in the future.
One of those indicators is building consents. Nearly 40,000 new homes were consented across New Zealand between May 2025 and May 2026. While a consent doesn’t guarantee a home will be built, Adam explains that rising building activity is often a sign that developers and homeowners are becoming more confident about the future.
Developers are constantly planning ahead. By the time a project is completed, they’re hoping buyer confidence will have improved, making today’s increase in activity a potentially positive sign for the market over the next 12 months. Mike also points out that residential construction supports a wide range of industries, making it an important contributor to broader economic activity.
Why Construction Costs Still Matter for Property Investors
At first glance, rising construction costs don’t sound like good news. For developers, higher building costs can squeeze profit margins, particularly when buyers aren’t prepared to pay more for completed homes.
However, Adam argues there’s another side to the story. If it becomes more expensive to build new homes, that higher replacement cost eventually supports the value of existing housing. Construction costs have increased by around 30% over the past five years, making them one of the key factors underpinning long-term property values.
The discussion also highlights why due diligence matters when purchasing off-the-plan. While some developers lock in construction costs through fixed-price agreements with suppliers, others may be more exposed to rising costs. Looking beyond the purchase price and understanding the developer behind the project can be just as important as the property itself.
What Auction Results Are Telling Us
Auction clearance rates provide a snapshot of buyer confidence in today’s market.
Adam explains that more properties are being passed in at auction before moving to deadline sales or price-by-negotiation campaigns. While this reflects softer buyer confidence, it also creates opportunities for purchasers who are prepared to do their homework.
Adam adds that quality properties are still attracting strong interest, while buyers now have the flexibility to be more selective. In a buyer’s market, purchasers can compare similar homes and negotiate harder, often creating opportunities that weren’t available a few years ago.
Looking Beyond the Property Market
Not every indicator comes directly from the housing market.
Adam points to New Zealand’s recent quarterly GDP growth as another encouraging sign, describing it as evidence that the wider economy is beginning to recover. While a single quarter doesn’t define a trend, it adds to the broader picture alongside improving activity in the property market.
The pair also discuss long-term trend lines, noting that after the rapid growth seen during 2021, property prices have largely returned to their long-term averages. While past performance doesn’t predict future results, Mike believes these historical trends remain useful when assessing where the market currently sits.
Why Christchurch Continues to Stand Out
One of the strongest data points discussed is Canterbury reaching a new all-time high median sale price.
Mike believes Christchurch could outperform Auckland over the next decade, pointing to its relative affordability, growing appeal and increasing migration from other parts of New Zealand. Adam also notes that Christchurch has been less affected by debt-to-income lending restrictions than Auckland, helping support demand in the region.
The conversation finishes with an important reminder that no single statistic tells the whole story. Adam explains that median sale prices can sometimes paint a misleading picture, which is why he also follows the House Price Index to compare like-for-like property values. It’s another example of why experienced investors focus on trends rather than individual headlines.
Key Takeaways
- Building consents can be a leading indicator of future confidence in the property market.
- Rising construction costs may support long-term house prices by increasing replacement costs.
- Auction clearance rates provide insight into current buyer confidence and negotiating opportunities.
- GDP growth and long-term trend lines help build a broader picture of market conditions.
- Christchurch continues to show strong fundamentals, with record median sale prices and improving demand.
- Looking beyond headlines and focusing on multiple data points can lead to more informed property decisions.
Next Steps
If you’re unsure how today’s property market data applies to your own situation, the Lighthouse Property team can help you understand the trends and make more informed property decisions.
If you’d like to watch more, check out these other episodes below.
For a no obligation discussion to see how we can help you on the path to wealth, please contact us.
Disclaimer:
The information in this article is general information only, is provided free of charge and does not constitute professional advice. We try to keep the information up to date. However, to the fullest extent permitted by law, we disclaim all warranties, express or implied, in relation to this article – including (without limitation) warranties as to accuracy, completeness and fitness for any particular purpose. Please seek independent advice before acting on any information in this article.
