Tauranga’s housing market has continued to show slow but steady growth over summer, despite falling interest rates and broader market stagnation nationwide.

The latest QV House Price Index shows Tauranga’s average home value increased by 1.6% to $1,020,948 in the three months to the end of February 2025.

This is slightly up from the 1.4% growth recorded in the January quarter, though values remain 1.9% lower than the same time last year.

Across the wider Bay of Plenty region, home values increased by 1.4%. Rotorua led with 2.1% growth.

New Zealand’s overall housing market has remained flat, with residential property values increasing nationally by just 0.5% in the three months to February. The average home is now worth $912,904—1.4% less than a year ago and 14.1% below its peak in late 2021.

QV operations manager James Wilson said it had been the country’s flattest summer for housing in six years.

“After some pretty significant volatility throughout the past half-decade, the housing market now appears to have well and truly stabilised,” Wilson said. “We’re no longer seeing so many significant shifts up or down, with home values staying ‘steady as she goes’ over the summer, despite falling interest rates and a spreading expectation that we’re now through the worst of it.”

Wilson noted that while declining interest rates had increased demand, this was being offset by slower population growth and an excess of properties on the market.

“Affordability issues are still evident in the main urban areas in particular, with unemployment still being of major concern for many Kiwis,” Wilson said. “As for investors, anecdotal evidence suggests that growing numbers are looking to re-enter the market in 2025, but it’s still going to take a while before interest rate relief fully phases through. Debt-to-income ratio limits will undoubtedly be a barrier for many of them.”

Wilson said first-home buyers were still benefiting from reduced competition with investors, provided they had job security and stable finances.

“Although economic conditions have been remarkably tough on everyone, first-home buyers have benefited in recent times from there being far less competition with investors,” he said.

“When things do eventually get more competitive, and all the excess stock on the market today is eventually absorbed, then we’ll see prices start to grow once more. That’s not looking imminent. In fact, at this early stage it appears as though we could well be in for a relatively flat autumn too,” Wilson concluded.