First home buyers: Now’s the time
Whilst the data shows Wellington's property market has slowed to a snail's pace, first home buyers seem to be winning - and winning quickly.
The numbers paint a pretty clear picture: Wellington now has 19 weeks of inventory on the market, up from 14 weeks this time last year, and the Wellington region's median price has dropped roughly 3.6% year-on-year. Days to sell have blown out to over 60 days - well above the 10-year average of 48. In short, it's firmly a buyer's market.
First home buyers are making the most of it, too. According to the latest Cotality-Westpac First Home Buyer Report, FHBs accounted for 37% of property purchases in the wider Wellington area in Q1 2026 - about 8 percentage points above the long-term average. Nationally, first home buyers are buying more properties than at any time since 2021.
But I'd pay caution to the headline-grabbing stories suggesting it's only going to get better for first home buyers. Here's why I think now is the time to go.
1. There's plenty of stock to pick from
There are simply more properties to choose from right now than there have been in years. Wellington's inventory has climbed sharply - 19 weeks of stock on the market compared to 14 this time last year. National inventory is up 3.9% year-on-year to over 37,000 listings.
At the same time, there are fewer active buyers competing for those properties. That's the perfect storm to halt the momentum of property price growth and keep prices stagnant (or even decreasing). More choice, more time to make decisions, and more room to negotiate. Things are better right now than they have been pretty much ever before for first home buyers.
2. Banks are keen to lend
Lending across all the major banks is down on where they'd like it to be. That means banks are doing their best to make it easier to borrow.
In the past week alone, one major bank has lowered their test rate - the interest rate banks use to assess whether you can afford a mortgage. It's typically higher than actual rates to make sure you can handle potential rate rises. A lower test rate means more people can borrow more money.
Another major bank has announced they're now recognising a higher percentage of bonus and overtime income when assessing applications. Previously, a chunk of that income might have been ignored - now more of it counts.
These are signs of banks doing everything they can to make it easier to say yes, not find reasons to say no.
3. Interest rates are very likely to rise
Here's the one that might sting a bit: interest rates are very likely to rise due to inflationary pressures. Both the RBNZ and major bank economists are projecting the OCR to move from 2.25% towards 3-3.5% over the coming year. When rates rise, banks' test rates rise to match them - meaning we can all borrow less.
So even if property prices stay the same or come down ever so slightly, higher interest rates will offset any savings you might have hoped to gain by waiting.
Let me put some numbers to it. Say you're borrowing $700,000 for a mortgage at the current 3-year fixed rate of 5.35%. If rates rise by 1%, that same mortgage at 6.35% looks very different:
At today's 3-year rate of 5.35%:
Year 1 interest: $37,450
Total interest over 30 years: ~$704,000
At 6.35% (a 1% rise):
Year 1 interest: $44,450 (+$7,000 more per year)
Total interest over 30 years: ~$866,000 (+$162,000 more)
The bottom line: waiting for prices to drop further could cost you far more in interest than you'd ever save on the purchase price.
So, what now?
There's every chance it'll still be an excellent market for first home buyers later in the year. But from a lending perspective, I think now is the time.
The process is simple. If you want to look into what's doable for you, book a time to catch up. We'll go over your options, how much you'd be able to borrow, what your repayments would look like, and build a plan from there. You don't need to have anything prepared - just a basic understanding of how much you earn is enough to get started.
We help first home buyers all the time, and we love it. For us, it's more than just sorting your finance. We want to help you all the way through - from that first conversation right through until you're in your home, keys in hand.
