I had one of those “Where has the time gone?” moments last month when I realised it’s been five years since we were first locked down. Five years! It somehow feels like both yesterday and a lifetime ago. Since then, we’ve ridden the Wellington property market’s wild rollercoaster – soaring peaks, deep troughs, and now, finally, the slow levelling off.
One thing I’ve been quietly noting is the gradual return of investors. After a few years of watching from the sidelines, Wellington property is starting to look like good value again, so if you’ve ever thought about jumping into the market, now might just be the time to give it some thought.
‘You Can’t Even Buy Materials For That’
Fans of The Castle might remember the Kerrigans picking up a chicken coop for $50, quickly followed by that unforgettable line: “You can’t even buy the materials for that.” Well, believe it or not, that chicken coop rule applies to Wellington real estate in 2025. Right now, it’s actually cheaper to buy an existing three-bedroom home, land and all, than it is to build one from scratch. Why? Because even though land values have dropped significantly over the past few years, construction costs haven’t budged. In fact, in many cases, they’ve gone up. So, if you’ve been tossing up between buying new or old, the math is pretty clear: second-hand homes are where the value’s at. Building, or even renovating, will start to stack up again once the market heats up and buying a house becomes out of reach for most. And so the cycle begins again!
The Yield Looks Better
Historically, a lot of people bought rental properties with one eye on retirement. If it didn’t cost them too much upfront, and they only had to top it up a little each year, they were happy to hold onto it long term. It was the classic “set and forget” investment. Fast forward to now, and after a drop in values and a few welcome cuts to interest rates, the yield, that’s the yearly rent divided by the property’s value, is finally starting to look healthy again. For the first time in a long time, the numbers are starting to make sense. There’s just one missing piece to complete the trifecta…
Vacancy
Rental income. And let’s be honest, it’s taken a hammering over the past 12 months. In Wellington, rents are down anywhere between 10–20%, which (oddly enough) mirrors the drop we’ve seen in property values. The rental market, much like the infamous tulip bulb boom of the 1700s, got caught up in a frenzy. There wasn’t a genuine accommodation shortage, it just felt like there was. That fear gave landlords the confidence to push rents higher, and for a while, tenants paid the price.
Now that supply has drifted back toward normal levels and tenants are no longer operating in panic mode, rents have cooled. The good news? Just like properties for sale, the better the rental quality, the better the rent. Comfortable homes in the right locations still perform well, and landlords who present their properties properly can justify stronger returns. And here’s the kicker: a modest 5% rent increase per year will double your rental income in just 10 years. Not bad for a bit of foresight and a fresh coat of paint.
BBQ Chat
Most markets don’t move because the data tells them to, they move when people feel something shifting. And once the public starts thinking, “maybe I should be doing something, because others are”, yes, FOMO plays a significant role; that’s when things really start to happen. As I mentioned, the investors are creeping back. But these aren’t your seasoned, spreadsheet-loving professional investors. These are everyday people dipping a toe back in the water. Even within the industry, agents are looking at investment options for themselves – always a telling sign. Why? Because the market’s been flat for a while. In some spots it’s even showing faint signs of life. That’s all it takes to build a bit of confidence. For many, it signals that the bottom’s probably behind us. And while we might not see any fireworks this year, or even next, I would rather buy now and enjoy the growth than chase the market once it’s already on the move.
The Wellington Market
Last month, Wellington officially became the most affordable city in the country to buy real estate, a big shift from being the most expensive just five years ago. From first to last in one market cycle. While the public sector’s pain has been well documented, the recession, by most accounts, is now behind us. The government’s shifting gears too, ready to spend and bask in the glow of improving economic news.
As for the market? It’s fine. Some houses are still taking a while to sell, and buyers aren’t interested in taking on anyone’s problems. But there’s movement, and competition is back. April is traditionally the last of the busy months before winter sets in. And if your home performs well through the colder season, it can be a great time to sell, less stock, more serious buyers, and no hiding those drafty windows.
Wellington Market Quick Stats
What’s on in Welly?
Comedy Gala, The Opera House, 3rd May 2025
The comedians announced so far will ensure your time at The Opera House will be laugh-filled. 2023 Billy T Award winner Abby Howells is joined by fellow kiwis Tape Face and Eli Matthewson. From across the ditch, veteran Australian comedians Felicity Ward and Chopper will be accompanied by He Huang. Her deadpan routines have gone viral since emerging in 2022. Having recently appeared in ‘The Office Australia’, New Zealander Josh Thomson will make an appearance. Also, look out for rising comedy star, Joe Daymond. He’s back home after creating, writing, and starring in ‘Bouncers’ for Comedy Central UK.
Wellington Saints vs Franklin Bulls, TSB Arena, 3 April 2025
The 2025 regular season features nine home games at TSB Arena. There are also two games at Te Rauparaha Arena in Porirua. Saints’ fans can expect high-energy basketball and a family-friendly atmosphere. Tip-off times have been optimised to make it easier for young fans to witness their heroes in action.
Join the game court-side and put your lungs to the test as you cheer on your favourite Wellington side.
Mayhem Portals, TSB Arena, 24 May 2025
The ultimate group of DJs gather for a party in Wellington. It’s billed as the biggest-ever production installation. ‘Mayhem Portals’ is an audio and visual feast set to take over the TSB Arena on Wellington’s waterfront. Lighting displays, pyrotechnics, huge screens, and wild staging are being readied to support an amazing lineup of music acts.
Click here to book your tickets now
Meet the Ben Stevens & the Team
If you, or anyone you know, could benefit from a considered market assessment by Wellington’s only licensed agent and registered property valuer, please do not hesitate to call. We are always happy to help.
