New Zealanders are world's most adaptable homebuyers, Cotality study finds

78% of New Zealand buyers are willing to cut lifestyle spending to afford a home, as the recent rise in interest rates adds to affordability pressures, according to new research from global property intelligence company Cotality.

Cotality’s new Consumer Sentiment Report reveals a significant shift in purchasing behaviour across Australia, New Zealand, the US, Canada, and the UK, driven primarily by affordability concerns. Among New Zealand buyers, the findings reflect a market where affordability is fast becoming the key driver of a widening regional divide.

Kiwi buyers are bending furthest to make homeownership work

New Zealand buyers are the most willing of any market surveyed to take out a smaller mortgage to improve affordability - 68% would do so, compared with 65% globally. They are also among the most willing to cut lifestyle spending, with 78% having already done so or planning to, compared with 69% globally.

59% of New Zealand respondents are open to purchasing a smaller home to improve affordability, while 68% would take out a smaller mortgage (65% globally), and 55% would pursue a no-cost or smaller refinance to reduce their debt (57% globally).

Australian buyers show a similarly strong willingness to adapt, with 75% cutting lifestyle spending and 57% open to buying a smaller home. Together, the two markets stand apart from the rest of the survey in just how much buyers are prepared to compromise to get a deal done.

"New Zealand and Australian buyers are making some of the biggest compromises of any market surveyed. They’re cutting spending, buying smaller, and restructuring their mortgages just to get into the market," said Lisa Jennings, Chief Commercial Officer at Cotality. “The recent rate increase in New Zealand shows these pressures are not going to alleviate any time soon, and they’re having a fundamental impact on what buyers are prepared to accept to become homeowners.

"Kiwi buyers are recalibrating rather than retreating," said Jennings. “As the market continues to face higher rates, we can expect the compromises being made now with smaller homes, smaller mortgages and tighter budgets to remain part of the picture for some time to come."