Property resale gains fall to lowest rate since 2013

New Zealand property owners are realising the lowest rate of resale gains in more than 12 years, as a soft market, long hold periods, and firm buyer expectations continue to shape vendor outcomes.

Cotality NZ’s Pain and Gain Report for Q3 shows 87.8% of properties resold for more than their original purchase price in the September 2025 quarter, down from 89.4% in Q2 and the weakest result since mid-2013.

“The figures are consistent with property values still being down significantly from their peak in many areas, as well as buyers holding most of the pricing power. Rather than a slump, it has been a gradual drift downwards for resale performance since early 2022,” Cotality NZ Chief Property Economist Mr Davidson said.

Nearly nine in every ten sellers still achieved a gain in the three months to September, with the size of those gains remaining substantial even though they are now at a five-year low. The national median resale gain in Q3 was $270,000, down from the late-2021 peak of $440,000 but still higher than anything recorded before late 2020. The median loss was $50,000, slightly below Q2.

When viewed against the median hold period for gains of 9.5 years, the effective annual return equates to around $28,400. Mr Davidson said that context is important.

“The resale performance of property is not weak in an absolute sense, but the figures highlight the role of time in the market. Longer ownership provides a much greater likelihood of securing a capital gain.”

Hold periods a key driver of outcomes

The length of time a property is owned before resale remains one of the clearest indicators of whether it will sell for a profit or a loss. The median hold period for a gain rose to 9.5 years, the longest in the series dating back to the mid-1990s. For a loss, it was 3.7 years.

Mr Davidson said both the timing of a purchase and the length of ownership were crucial.

“Three-and-a-bit years ago places you at a point in the cycle when prices were extremely high and mortgage rates were already rising. Anyone who bought then and has since faced a change in circumstances is more exposed to selling at a lower price than expected.”

Houses outperform apartments

Standalone houses continued to outperform apartments in Q3, although both property types softened over the quarter. House resales recorded an 11.4% loss rate, up from 9.8% in Q2 and the highest level since mid-2013.

Around 36.2% of apartment resales in Q3 were made at a loss, up from 34.5% in Q2 and the highest level since early 2012. Only around 64% of apartment resales achieved a gross profit.

Mr Davidson said the performance gap reflects long-run market behaviour rather than signs of distress.“

Apartments tend to record smaller long-term capital gains than standalone houses, so they carry a higher chance of a loss if resold into a weaker market. That’s normal for this part of the market and there’s no evidence of widespread fire-sale behaviour.”

Auckland and Wellington remain the softest of the main centres

Auckland recorded the highest proportion of loss-making resales among the main centres at 19.3%, up from 15.9% in Q2. Wellington followed at 15.8%, with both results well above the national average and due to similar drivers.

“Both Auckland and Wellington went through very strong growth during the boom period, so more recent buyers paid top prices and are now more vulnerable. Auckland’s larger pool of apartments also contributes to its higher loss rate, although that reflects long-run performance rather than short-term weakness,” he said.

Median resale gains in dollar terms remained varied. Tauranga recorded the largest nominal gain among the main centres at $352,000, followed by Auckland ($338,000) and Wellington ($330,000). Christchurch remained the most resilient of the major centres in relative terms, with 5.5% of resales made at a loss in the three months to September, albeit a smaller median gain ($265,000) than some other areas.

Regional insights

Markets outside the main centres continued to show mixed results, with solid resale dollar figures and a reduction in the proportion of resale losses across some North and South Island markets.

Queenstown Lakes remains the standout, with only 2.4% of resales made at a loss in Q3 and a median gain of $486,000. Invercargill also strengthened, recording 2.6% loss-making resales, down from 3.9% in Q2.“Queenstown has limited supply and deep demand, which helps preserve values even when activity slows.

Invercargill meanwhile benefits from its affordability appeal and therefore steady buyer interest, giving it a level of resilience not seen everywhere,” Mr Davidson said.

Nelson showed the weakest performance among the key South Island markets, with loss-making resales rising from 8.5% in Q2 to 14.1% in Q3.

A growing market in 2026 but pain won’t immediately disappear

The share of loss-making resales is expected to remain elevated in the near term, given the subdued market backdrop with outcomes to hinge on values, household sentiment and the volume of stock for sale.

“Even if sales activity improves, values remain well below their peak and listings are still high by past standards,” Mr Davidson said.

“Vendors may need to meet the market, but gains will remain substantial for those who have held for a long period. Most owner-occupiers won’t see a cash windfall, as equity generally rolls straight into the next purchase unless they’re downsizing or moving to a cheaper location.”

There are early signs that rising sales volumes are reducing available stock, and the outlook for 2026 points to price growth supported by lower mortgage rates and a gradually strengthening economy.

“Property resellers may fare better in 2026, although a rapid turnaround looks unlikely,” Mr Davidson said.

“Regions with strong affordability or tight supply, such as Queenstown Lakes and parts of the lower South Island, remain best placed to hold their ground.”