Are you buying and wondering how much is too much to offer?
Or perhaps you’re selling and trying to figure out what your property is realistically worth in today’s market?
Either way, this article is for you. But before we talk numbers, let’s look at the bigger picture.
A market in “wait and see” mode
According to recent commentary(1) from Quotable Value (QV) and Cotality, New Zealand’s property market remains relatively subdued overall.
Interest rates, cost-of-living pressures, global uncertainty and the upcoming general election are all contributing factors. Buyers are still active – particularly first-home buyers – but many are taking longer to make decisions.
The result is a balanced market, where pricing expectations matter more than they did during the “boom years” of 2020-2022.
The most important thing about property value
Before diving into estimates and appraisals, there’s one key thing to remember: a property is only worth what someone is willing to pay for it.
That may sound obvious, but it’s one of the most important concepts in real estate.
It means there’s no single “correct” value for a property – only more or less accurate estimates.
A home’s value can shift at any time depending on:
- buyer demand
- borrowing conditions
- competition
- timing
- confidence in the market
- emotional factors.
That’s why two very similar properties in the same suburb can sometimes sell for very different prices.
Why one property can have multiple “values”
Already started doing your research? You may have noticed that estimates across different platforms don’t always match.
That’s because different tools measure value differently. And while these numbers can still be useful, it’s crucial to understand what they represent.
Rateable Value (RV)
A property’s RV is mainly used by Councils for rating purposes and is usually updated every three years. It can provide a rough reference point, but it’s not designed to predict what a property would sell for in today’s market. And in fast-moving markets especially, an RV can quickly become outdated.
Online estimates
Platforms like Homes.co.nz, TradeMe Property and QV use algorithms, recent sales data and market trends to generate estimated values. These tools can be helpful for research and comparisons, but they’re still just rough estimates.
Registered valuations
For a more detailed assessment, you may choose to engage a registered valuer. They will provide a registered valuation based on a physical inspection of the property, comparable sales and local market conditions.
If you’re buying, your lender may require a registered valuation in certain situations – for example if you have a smaller deposit, the property is unusual or the market is changing quickly.
Real estate appraisals
Real estate agents can also provide estimated sale ranges based on current buyer demand and comparable sales. Again, these are guides rather than exact predictions.
What buyers need to keep in mind
For buyers, “value” is not just about finding the cheapest property.
It’s about understanding what a property is realistically worth in the current market, and whether it aligns with your budget and long-term goals.
In more balanced markets like the current one, buyers may also have more negotiating power and more time to carry out proper due diligence. So as exciting as the house hunt can be, don’t feel pressured to rush the process. Take the time to research the area, compare sales and make a well-informed decision.
What vendors need to keep in mind
For vendors, pricing expectations matter too.
Emotional attachment, renovation costs or previous market highs do not always translate directly into market value. At the end of the day, buyers decide what they’re prepared to pay.
In slower markets, overpricing can sometimes reduce interest early and make a property harder to sell later. Talking to a real estate agent can help you better understand where your property sits in today’s market..
Want to stay on top of the property market?
You may also be interested in the article we published last month, outlining key tools and resources to help you monitor market trends, buyer demand and pricing activity in your area.
How Mortgage Link can help
Mortgage Link advisers are not valuers or real estate agents, so we can’t tell you what a property is worth.
What we can do is help you understand your borrowing position early, so you can approach the market with more confidence and clarity.
And if you already own property and are thinking about selling, we can help you review your mortgage structure, equity position and future plans.
Get in touch if you’d like to talk it through.
Source:
- Mpamag.com - NZ house prices plateau as election and rate worries loom
Disclaimer: The information provided in this article is intended for general informational purposes only and does not constitute financial advice. Every individual’s financial situation is unique, and financial decisions should be made based on your specific circumstances and goals. We recommend consulting with a qualified financial adviser before making any investment, insurance, or mortgage-related decisions.
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