NZ Property Market 2026: Granny Flat Rules, Record Listings & Interest Rate Forecasts

Is the "Buyer's Market" finally here? In this first episode of 2026, we break down a massive week for New Zealand real estate. The data is in: December stock levels have hit a 10-year high, giving buyers more choice than we've seen in a decade. But with new rules for Granny Flats kicking in today and economists predicting a twist in the OCR tale, the window of opportunity might be moving faster than you think.

We discuss the new legislation allowing 70sqm minor dwellings without consent—a game-changer for adding value and yield . We also dive into the latest lending disputes regarding age limits on mortgages and why Westpac and Tony Alexander are warning that the upcoming election could throw price predictions off course.

In this episode, we cover:

• 🏠 Record Listings: Realestate.co.nz reports the highest December stock levels since 2014.
• 🔨 Granny Flats Unleashed: The new "no-consent" rules for 70sqm builds start today—but there are conditions.
• 📉 OCR Forecast: Why Westpac is now pencilling in a rate hike post-election.
• 🗳️ Election Impact: Tony Alexander explains why the 2026 election makes forecasting house prices risky.
• 👵 Lending Rules: How old is "too old" for a 30-year mortgage? 

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Sources & Articles Discussed

00:01:17 Topic #1:  Good Returns 13th of January - One OCR hike pencilled in by Westpac

00:02:58 Topic #2: 1News 15th of January - No-consent granny flats from today, but it's 'not a free-for-all'

00:04:41 Topic #3: RNZ 13th of January - How old is too old for a home loan?

00:08:28 Topic #4: Oneroof.co.nz 14th of January - Tony Alexander: Why the 2026 election is throwing house price predictions off course

00:11:21  Topic #5: Realestate.co.nz 12th of January - Rare advantage for property seekers as stock hits 10-year De

Transcript

 Happy New Year and welcome to our first episode of 2026. I'm Debbie Roberts, owner and financial adviser at Property Apprentice. Join me today for the Week in Review where I talk about current events for the everyday investor and home buyer. This week, we are looking at a market that's kicked off the year with some surprising data, new opportunities, and shifting economic forecasts.

Our topics for this week, topic number one from  📍 Good Returns on the 13th of January. One OCR Hike penciled in by Westpac. Topic number two from  📍 1News on the 15th of January. No consent granny Flats from today, but it's not a free for all. Topic number three from  📍 RNZ on the 13th of January. How old is too old for a home loan?

Topic number four,  📍 Oneroof.co.nz on the 14th of January from Tony Alexander. Why is the 2026 election throwing house price predictions off course? Topic number five, from  📍 realestate.co.nz on the 12th of January. Rare advantage for property seekers as stocks hit 10-year December high.

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 So first up for this week in review from Good Returns on the 13th of January, one OCR hike penciled in by Westpac. Westpac

economists forecast a single official cash rate or OCR hike this year, tentatively scheduled for December. Following the election, Westpac chief economist Kelly Eckhold noted that while the RBNZ had signaled an end to cuts in November, the market subsequent pricing of immediate price hikes was premature.

He welcomed recent comments from the new RBNZ governor Dr. Anna Breman, regarding falling inflation and sustained growth, which have helped realign market expectations with the central bank's Actual thinking. Westpac expects inflation to ease from 3% to within the Rbn Z's target band by midyear driven largely by soft housing costs.

Eckhold highlighted the annual rental inflation is at its lowest since 2010, and construction cost inflation has slowed sharply. With housing supply increasing and population growth remaining low, these costs are expected to remain subdued through early 2026. The broader housing market shows limited momentum with sales tracking sideways and prices flat since mid 2023.

Eckhold observed that the impact of falling interest rates has been offset by a surge in listings adjusted for seasonal trends. The number of homes for sale is at a decade high. As a result, the bank anticipates only modest house price growth in the coming year. 

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Topic number two, from 1News on the 15th of January.

No consent granny Flats from today, but it's not a free for all. Starting from January 15th, new Zealanders can build granny flats up to 70 square meters without resource or building consents. Those specific conditions do still apply. Housing Minister Chris Bishop explained that while the policy offers flexibility to address the housing crisis, it's not a free for all. Flats must adhere to simple designs, comply with the building code and be built or supervised by licensed professionals.

Restrictions such as site coverage, limits and prohibitions on building and flood zones remain. In effect, building and construction minister Chris Penk noted that while councils cannot reject these projects, they must be notified before construction begins and records updated upon completion for rating and infrastructure planning.

He argued the distributed nature of these units should minimize strain on local water services. Regional development Minister Shane Jones highlighted that the policy could save homeowners up to $5,600 in direct costs and reduce build times by approximately 14 weeks. The reforms part of a coalition agreement are expected to benefit students, seniors, and rural workers while boosting the construction sector.

The Ministry of Business Innovation and Employment has published guidance and templates to assist homeowners with the exemption process More to follow, especially for our clients of Property Apprentice.

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 Topic number three, from RNZ on the 13th of January. How old is too old for a home loan? A woman has lost a complaint to the banking ombudsman after arguing that her bank was irresponsible for allowing her and her husband to take out a 30-year mortgage in their mid fifties.

The couple applied for the loan in 2020 at ages 56 and 53, and finalized the $479,000 borrowing in 2022. Following her husband's death in 2025, the woman claimed that the bank failed to account for their age or for the fact that they didn't intend to work past typical retirement age. The Ombudsman investigated the bank's records and determined that the lender had indeed considered the couple's age and future plans.

The review found the bank had verified income and expenses, applied conservative calculations with reasonable buffers, and confirmed a surplus of income. Consequently, the ombudsman ruled the bank had reasonable grounds to believe that the loan could be serviced without substantial hardship and did not uphold the complaint.

Mortgage advisors indicate that age is a common hurdle for borrowers, though banks can't discriminate based on the age alone. Link Advisory Head, Glen McLeod explained that lenders typically have policies capping loan terms at age 65, 70, or 75. The critical factor is an exit strategy, a clear plan for how the loan will be repaid if the term extends beyond retirement.

This might involve using KiwiSaver funds, selling an investment property, or downsizing the family home. Jeremy Andrews of Key Mortgages noted the older first home buyers are often declined even when mortgage repayments are lower than their current rent, simply because the loan term would require them to work well past retirement.

However, he added that banks can mitigate this risk by considering if the borrower has a sedentary job. That allows for longer employment or if they can accelerate payments once dependents leave home .Loan market advisor Karen Tatterson highlighted the importance of insurance in these scenarios. She suggested that while clients often request longer terms to lower immediate costs, the risks must be clearly discussed.

Tatterson noted that the had the deceased husband held life insurance, it could have cleared some, if not all of the debt, making the situation much more manageable for the surviving partner. She advised that older borrowers must have a solid repayment plan and should be prepared for shorter loan terms depending on the lender's specific approach.

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That's www.propertyapprentice.co.nz.  Topic number four from Oneroof.co.nz on the 14th of January. Tony Alexander: why the 2026 election is throwing house price predictions off course. This analysis is provided by independent economics commentator Tony Alexander. The common consensus suggests that New Zealand house prices will rise modestly this year, likely by a around 5%.

Though this growth is being constrained by two major factors, increased housing supply, and a trend of investors selling up. Supplies has been bolstered by efforts to free up land and speed up consenting initiatives that trace back to Auckland's 2016 unitary plan. Consequently, construction consents have remained resilient despite the recent economic downturn.

Consents in the three months to October were up 19% year on year with the annual total reaching 35,600. Meanwhile, some investors are exiting the market due to falling rents, rising household costs like insurance, and rates and fears regarding Labour's election, promises to introduce a capital gains tax and potentially remove interest deductibility

again. Despite these headwinds, the market is supported by falling mortgage interest rates, and a strong employment outlook. Recent data indicates a surge in hiring intentions with the ANZ business outlook showing a net 28% of businesses plan to hire in the coming year, and that's the strongest result since 2014.

Similarly, the N-Z-I-E-R survey reports are net 22% of firms plan to hire in the next quarter. This improved job security is a key driver for consumer spending and property purchasing decisions. However, significant uncertainty remains regarding the global geopolitical environment and the impact of the US President's actions, which is currently impossible to calculate.

Domestically, the upcoming general election is causing genuine concern among businesses. Consequently, many economic decisions are likely to be put on hold from the middle of the year until the election outcome is known, which could flatten housing market's recovery in the second half of this year. What does this mean for buyers?

The buyer's market could be here for a bit longer, meaning that those who aren't scared off by the what ifs are likely to do really well over the long term. It's more important now than ever to focus on stronger cash flow when you purchase a property, just in case we get a change of government and lose interest deductibility.

This is potentially why less investors are interested in buying new builds at the moment, as rental returns on existing properties tends to be significantly stronger. 

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Topic number five from realestate.co.nz on the 12th of January. Rare advantage for property seekers as stock hits 10-year December high.

So this literally follows on from the previous summary where I discussed the fact that we're in the buyer's market. December, 2025, marked a decade high for properties, dock levels with inventory surpassing 30,000 listings for the first time in any December since 2014. Data from realestate.co.nz indicates that this capped off a year of consistently high supply where monthly figures remained above the 30,000 threshold throughout 2025.

Total stock rose, 3.1% year-on-year to reach 30,390 properties with Northland up 11.4% and Auckland up 11. Percentor recording the most significant gains. Realestate.co.nz spokesperson Vanessa Williams observed that while vendors typically pause sales during the holiday season, nine out of 19 regions defied this trend with increased new listings. She suggested that this 10-year high indicates sellers are feeling confident heading into 2026. While buyers are benefiting from greater choices and taking a more considered approach nationally, new listings rose 2.8% year on year with 4,900 properties hitting the market.

The Bay of Plenty led this seasonal buck with a 22.2% surge in new listings followed by Wellington up 18.5% and the central North island up 12.9%. Williams noted that such activity highlights strong vendor motivation even before the festive season concluded. However, the trend was not universal. Marlborough, Nelson and Bays and Gisborne saw a double digit declines in new listings while the Waikato recorded a December all time low of just 355 new listings.

Price trends varied significantly across the country, though the national average asking price held steady at $860,274, that's up 1.7% annually. Double digit growth was seen in the Bay of Plenty, Central Otago Lakes district and Otago. Conversely, Gisborne saw a sharp 29.1% drop in its average asking price.

Notably Wellington's average asking price fell 9.1% to $797,463, dropping into the 700 thousands for the first time since May 2024. William stated that this softening suggests that sellers are meeting the market, potentially opening a window for buyers who've been waiting on the sidelines.   📍  📍 The rules of the game have changed as of the 15th of January

you can build 70 square meter granny flats without resource consent. Terms and conditions apply. Unlocking a powerful new way to manufacture equity and high yield cash flow in a flat market combined with a massive surplus of listings and interest rates still being pretty low 2026 is shaping up to be the year for the strategic investor, but with Westpac forecasting inflation to fall and the economy to pick up competition from other buyers could be just round the corner.

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So if you are interested in finding out more about how we can help you, go to www.propertyapprentice.co.nz and register today.   📍  📍 If you've already been to one of our free events and you'd like to know more about how we can help you on your journey book a no obligation phone call or meeting with my husband Paul Roberts through our website.

That's www.propertyapprentice.co.nz. Thanks for listening. 

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