NZ Housing Market: First-Home Buyers Lift Share as Filled Jobs Rise

Nick Goodall (00:01):
Kia ora and welcome to the New Zealand Property Market Podcast, brought to you by Cotality for the 2nd of November 2026. I'm Head of Research Nick Goodall, and today I'm joined, as per usual, by Chief Economist Kelvin Davidson. Kelvin, there's another big data release this week with the official labour market statistics out on Wednesday, and of course our Home Value Index for October will be out as well. But first, how did the release of the Westpac Cotality First Home Buyer Report go last week? It's a topic we've talked about plenty over the last few months, and I know you did a special podcast on it with Satish Ranchhod from Westpac last week, so you don't need to go into too much detail. But do you have any highlights, surprises or new insights that people might not have picked up on?

Kelvin Davidson (00:43):
We talk about the headline figures, like first-home buyer market share, most months. But there are a few extra details in the First Home Buyer Report that we don't always cover, so I can go through those briefly.

The message that first-home buyers are strong across the country still very much holds. I found myself saying "from Auckland to Ashburton" or "from Whangārei to Winton". From north to south, first-home buyer activity is still pretty strong.

The report also shows that it's not just a geographical story. First-home buyers are strong across the price spectrum too, which is something we don't often talk about. If you split transactions into three brackets by value (the bottom 30%, the middle 40% and the top 30%) and look at that over time, first-home buyers have actually increased their market share in each of those price brackets.

To put a number on it, their market share in the middle 40% of transactions by price is recently 30%. If you look back four or five years, that share was 25%. So they've increased their share even in that middle tier. And 30% is actually slightly above their overall market share, which is about 29.5%. So it's not the case that they're always buying at the bottom. They're active right across the price spectrum. Even in the very top price bracket, first-home buyers are still accounting for around 14% to 15% of transactions. Yes, their share gets smaller as you go up through the price spectrum, but even in that top bracket, they're still a decent chunk of activity. First-home buyers aren't only buying at the bottom and working their way up. They're pretty active across every price bracket, and they've increased their share in each one. There are more statistics on that in the report.

Then there's what they're buying. So far in 2026, 76% of first-home buyer purchases have been standalone houses. If you go back four or five years, that figure was below 70%. They're getting bang for their buck in this market, because it's a buyer's market with plenty of choice. They're paying a little more this year, with the median price paid at $715,000, but they're also getting a lot more house. So I see it as a value-for-money story.

One finding that came out of Westpac's data is the average age of first-home buyers. It's still a lot higher than it used to be, and if anything it crept up a little in the latest numbers, to 35.5 from 35 previously. There are no hard and fast conclusions here, but over time I think it's been an affordability issue. People have had to wait longer to buy their first home because property has become more expensive. I don't want to overplay this latest small increase, but I do wonder whether, right now, it's not about affordability. People may simply be waiting a little longer because they can. There's no rush and plenty of choice, so they may as well get the house they want rather than buying six months earlier and not quite getting the right property. Waiting an extra three or six months to get the home they really want might be part of why the average age has ticked up. It's still a lot higher than it used to be, so there probably is still an affordability issue in there too, but at the moment there's also no need to rush.

It's always a great report to work on. Satish at Westpac works along the same lines as I do: get the work done efficiently and don't hold each other up. It's great to have access to Westpac's figures as well, which give us the average LVR and average age numbers that we can't get from our own data. The report went down pretty well, because everyone's keen to see insights on first-home buyers. Media coverage is pretty congested at the moment given everything going on around the world and here with the election, so it's a bit harder to get airtime, but I think we did pretty well.

Nick Goodall (05:17):
Well covered, mate. The only thing I'd add is that the Westpac Cotality First Home Buyer Report goes down to every territorial authority in the country. So wherever you are, you can see what first-home buyers are buying, how much they're paying and what share of sales they make up. I'll leave a link to download the full report in the show notes.

It's great to get insights from both sides: the properties being bought, from Cotality's data, and the demographics and lending details from the Westpac team. The report also looks at the impact of interest rates compared with a couple of years ago, and what that means for borrowing and purchasing power, which has obviously influenced first-home buyer activity as well.

The increasing age surprised me when I saw it, but I agree with your conclusion that it probably reflects the lack of urgency in the market. At a time when people could actually get in at a younger age, they're not rushing. They're waiting to get a property that's more suitable and one they know they can stay in for longer. That's why I find this so interesting every time: the report measures consumer behaviour and the motivations behind it. Whether it's drawing on KiwiSaver to buy a first home or anything else, the reasons to become a first-home buyer don't change. Yes, we might be seeing changes on the investor side, where it's harder to make the numbers stack up these days, although investors certainly haven't disappeared from the market. But the motivation to become a first-home buyer is still really strong, the activity shows it, and first-home buyers are taking advantage of this quieter market. Do go and download the report and keep it as a handy reference document.

In terms of economic releases, Kelvin, there were a few last week. The main one, which we covered in our special podcast, was the Reserve Bank's OCR decision in last Wednesday's Monetary Policy Review. Is there anything you've tracked since we recorded that, or any other commentary worth covering? It was a surprise, and we still expect an increase in December. After that, maybe you could take us through last week's filled jobs data as a lead-in to this week's official labour market statistics, where I think the unemployment rate will be the key figure.

Kelvin Davidson (07:59):
Not too much to add. Most of what I've seen has been about whether the Reserve Bank made the right or wrong call, with some people saying inflation is clearly a problem so it should have lifted the OCR. It's done now, so there's not much point arguing over whether it was right or wrong. I was surprised, but it is what it is, and we just need to look ahead to the next decision.

Nick Goodall (08:30):
Perhaps interestingly, the US Federal Reserve held its rate as well, and I think another central bank somewhere around the world did too. I don't know whether that's a sign others are taking a similar view and waiting a little longer to see the longer-term impact, or any resolution in the Middle East over the next few months. I don't know all the inflation statistics for the United States and other countries, including their domestic and tradable inflation, but it was interesting that within a day or so a couple of other central banks made a similar call. So the Reserve Bank of New Zealand wasn't exactly going out on a limb.

The Reserve Bank had also signalled six or eight weeks earlier that the next decision could be a hold. At that point it looked like October would be a hold and December would be the increase. It's just that in the meantime things seemed to change enough that the market expected them to go the other way. I don't know if there's anything in that, but it jumped out at me in the following day or so.

Kelvin Davidson (09:37):
I didn't listen to the Monetary Policy Committee press conference, but I believe they said the decision had nothing to do with the election, which I believe. It's also interesting that there are elections in the United States too, with the midterms. Maybe central banks don't want to get involved in any political manoeuvring, even if they don't say so publicly. Who knows? There could have been an element of that, even though they've said no.

I think some of the right-or-wrong discussion came from the fact that central banks don't really have to commit to anything. As the facts change, they change their minds. There was a bit of unease that the Reserve Bank had indicated last time it would increase the OCR and then didn't, and whether that risks unnecessary market volatility. I don't think that's a big issue, because if the data changes, you change what you said six or eight weeks ago. Either way, it's done. We'll get the election out of the way and see how the data looks after that.

Nick Goodall (10:53):
All good, mate. Take us through the filled jobs data then, and any expectations you have for the official labour market statistics this week, particularly the unemployment rate and any signs of wage growth, since that's part of the concern about second-round inflation.

Kelvin Davidson (11:16):
In our internal note I called it a quiet rise in employment. You almost have to whisper it, but we're actually creating some jobs. These figures can be revised, and filled jobs is only one of several measures of employment and unemployment. But Stats NZ's monthly filled jobs data has been edging higher. It doesn't get much coverage, but I think we now have a bit of an upward trend. We had a 0.3% rise in September. As the data stands now, the low point seems to have been around October last year. Since then, filled jobs haven't risen every month, but the rises have been fairly consistent, and filled jobs are up by about 28,000 over the past nine or ten months. It's not massive job creation. That's roughly a 1% increase over that period. But behind the scenes, even with ongoing economic uncertainty, there is some job creation happening.

On the other side, we still have population growth. It may not be as strong as in the past because migration isn't strong, but labour supply has been increasing. Within that population there's also the participation rate, meaning whether people are actively in the labour market or not, which can influence how the unemployment figures come out. So there are a lot of moving parts. Both sides of the equation are rising: there's population growth, but there's jobs growth too. That's probably been flying under the radar. It's not strong growth, but some jobs growth is better than none.

On Wednesday we get Stats NZ's benchmark quarterly labour market figures. From the forecasts I've seen, we might see the unemployment rate come down a little in the third quarter, from 5.6% in Q2 to perhaps 5.5%. That would reflect the bit of jobs growth we've seen starting to eat into unemployment.

The swing factor is the participation rate. If people who have been outside the labour force, not looking for work, suddenly decide they could get a job now and start looking, then the participation rate goes up. In that case the unemployment rate could rise even though there's been jobs growth. But as things stand, with a bit of jobs growth and some population growth, most expectations are for the unemployment rate to tick down a little. At 5.5% it would still be too high. It depends which period you use for the average, but over the past decade unemployment has averaged around 4.5% from memory. So there's still spare labour in the market, but you have to start somewhere, and any fall would be good.

Wages are what the Reserve Bank always talks about in terms of second-round inflation. If higher prices become embedded, people see higher costs and ask for higher wages, and it becomes self-reinforcing. So it's definitely worth watching the wage growth figure. It will probably still be fairly subdued, which would support the Reserve Bank's view that it doesn't need to rush on the OCR. It's hard to see wage growth picking up much while unemployment is above normal. The labour market is probably still tilted in favour of employers rather than employees. Ideally, we'd see the unemployment rate come down a little on Wednesday.

Nick Goodall (15:43):
We'll talk about it next week. The figure I always look for is the underemployment rate. It tells you that people have a job but want more hours and more work, because they're dealing with higher costs. That one sometimes slips under the radar.

We still have a bit of time, Kelvin, so could you say a word on the business and consumer confidence data that came out last week? It's holding up a bit better, which ties in with your point about firms continuing to employ people and create jobs. It's another sign that businesses are just getting on with things, as we discussed a few weeks ago. It's tough out there, and consumers are dealing with high costs and don't always feel great about their jobs, but they still feel reasonably good about what they've got and have some expectations for the future, especially on inflation.

Kelvin Davidson (16:47):
These are the ANZ measures of business and consumer confidence for October. Given the circumstances, they're actually pretty decent. On a chart, both headline measures were pretty stable. They've been higher in the past, but they've also been lower, and they held steady from September to October, even though that period felt like it brought extra uncertainty with fuel prices rising again.

The first thing that came to mind when I looked at the numbers was that we never know the counterfactual. Maybe confidence would have held up regardless of what oil prices were doing. We'll never know that for sure. But in the wider context of uncertainty and higher fuel prices, it's a pretty fair result to have business and consumer confidence holding steady. Maybe people are just learning to live with it, and focusing on other costs or other parts of what they're doing. It's only one month, and we don't know what next month brings, but there does seem to be a sense that people are getting on with things and that there's more resilience out there. Add in some growth in filled jobs and a manufacturing sector that's going okay.

As I said in our internal note, for every encouraging economic indicator there's a less encouraging one, so the picture is still patchy. But if you want to take a glass-half-full view, there's enough there to say the economy is starting to grow while we still have an inflation issue. So some will say the Reserve Bank should have pushed the OCR up, but there are weaker indicators too. Everybody can find something in these figures to support their own view. On the whole, though, these are pretty good results given the wider backdrop.

Nick Goodall (18:51):
The data certainly isn't all pointing in one direction, so it makes sense to wait a little longer. It's good to see that we're a resilient bunch of Kiwis finding ways to get on with it. Let's wait for the unemployment data this week. It will certainly be an interesting month or so.

The election is obviously the number one thing on people's minds this week, so make sure you get out there and vote. The voting booths are already open, so go and get it done. And let's all keep our fingers crossed for a relatively short period of coalition negotiations. We know there will definitely be a coalition, whichever way it goes, but let's hope it doesn't drag on, because that could influence how things play out as well. Let's hope for clarity sooner rather than later.

The only other work item on my mind is the October Home Value Index this week. I know you've looked at the weekly data on our website, and it looks like more of the same, with continued weakness in Wellington, a little in Auckland, and Christchurch perhaps showing signs of dropping slightly. The official Home Value Index goes to media tomorrow and will be public on Thursday, so keep an eye out for it. That wraps up the property data and economics for this week, Kelvin. Anything else on your mind before we do a weekend catch-up?

Kelvin Davidson (20:28):
No, that's it. We'll be busy this week with the Home Value Index as the focus, so look out for that one.

Nick Goodall (20:35):
Tell us about your weekend then, mate. Did you get dragged into some Halloween antics, and did you catch any sport?

Kelvin Davidson (20:42):
We did Halloween. I'm never sure what to make of it, because it wasn't a thing when I was young, so the grumpy old man in me comes through a bit. But I kind of enjoyed it. We took both kids out, and lots of other families from the street were out too, so we went around in a big group. We weren't one of those scootering gangs of 12-year-old boys hoovering up everyone else's chocolate. I'd say our etiquette was better than that. It felt like a community thing. You meet people you haven't met before, and there's a nice feel to it. As it turned out, we didn't come home with too many lollies because everyone else had hoovered them up, so we didn't have to deal with massive sugar highs and lows. Probably a success on that front.

Not too much else. Normal family stuff, and cricket on Saturday morning. We're still at the age where it's more about herding cats than anything else. We're definitely not at the "play late, move your feet, watch the ball" stage yet. There's no technique coaching. But participation is the main thing with Saturday morning cricket, so it's going well. How about you?

Nick Goodall (22:04):
On the cricket front, we had an open day yesterday. My son's playing this season, and I've offered to help organise and coach. The kids had a play around yesterday, they're really keen, and they're looking forward to their first game this week. It's a pity the Black Caps' T20 games have been on so late, because the kids can't really watch them, and seeing what happens at the top level helps when you're learning a new sport. Although maybe you wouldn't tell them to copy Glenn Phillips' technique. He's set a record for the most runs in a bilateral T20 series, and he's definitely unorthodox: see ball, hit ball, and very successful at it. It was good to see the Black Caps win a couple of the dead rubbers to make the series look more competitive than it really was after those first few games, especially the Wellington game where India tore us apart. It sets up the one-day series really well, and I think the first match is on Wednesday.

I excused myself from Halloween in the neighbourhood this year because I had my end-of-season football break-up. We played foot golf out in Lower Hutt, which was quite cool, and then caught the Wellington Phoenix afterwards. That's three wins out of three, and four points clear at the top of the table. It's only three weeks in, so I don't want to get carried away, but it's looking like a more promising season. The real test is this weekend, with the first derby against Auckland FC up in Auckland on Saturday. We've never won that game, never even got a point out of it, and we've scored very few goals. But this Phoenix side is different from last year's, and Auckland's looks different too. If we've ever had a chance, it's this weekend. I just hope the mental block of the derby doesn't bring things crashing down. I think it's at five o'clock on Saturday, in among the one-day international here in Wellington, the election results, and the Kiwis playing Tonga on Saturday night.

I also caught a bit of the Tonga versus Samoa game in the Rugby League World Cup last night. I loved the challenge of the war dances at the start, and there was real feeling in that game and a tight result. It's getting to the pointy end now, so it'll be interesting to see how the semi-finals play out. I really enjoyed my Saturday, probably a bit too much, but starting the activity early in the afternoon meant I finished early, got home for a decent sleep, and still made it along to the cricket open day yesterday. There's plenty going on this week and this weekend. Good time to be alive.

Kelvin Davidson (24:48):
Yep. It pays not to look too far ahead in the calendar at this time of year. I think you'd freak yourself out with how much there is to do before the end of the year, including social events. One day at a time is my focus at the moment.

Nick Goodall (25:02):
Too right. That reminds me, I need to book flights for a trip to Auckland in a couple of weeks. Now that we've hit November, that's come around a lot faster than I expected, so that's a job for after this. Anything else before we get out of here?

Kelvin Davidson (25:19):
That's it. Crack on.

Nick Goodall (25:20):
Thanks as always for your thoughts and insights, Kelvin, and great job on the Westpac Cotality First Home Buyer Report. I'll leave a link to download it in the show notes. Thank you very much for listening, and please get in touch with any questions about the report or anything else going on at the moment. We're always keen to hear your feedback. That'll do us for today. My name is Nick, he's Kelvin. You've been listening to the New Zealand Property Market Podcast. Mā te wā.