For investors that means you’re buying after a substantial drop in prices, rather than after a period of rapid growth.

Lower property prices can mean a smaller deposit, less debt, and potentially a higher rental yield.

Of course, property prices could still fall further. We’ll come to that shortly.

But if you’ve been waiting for property prices to come down before investing, they have.

The Reserve Bank currently expects prices to fall a little further, reaching a bottom around March 2027.

But from there its forecasts show house prices starting to recover.

By March 2029, the Reserve Bank forecasts house prices will be about 9% higher than at the bottom of the market.

Of course, forecasts are forecasts. There’s no guarantee house prices will follow that exact path.

Pro #2 – It’s a buyers’ market, there’s lots of choice

Buyers have more choice when buying property.

According to realestate.co.nz there were 9.3% more properties for sale in July 2026 than at the same time last year.

That meant there were more than 35,000 properties sitting on the market for buyers to choose from.

The funny thing is, that’s not because heaps more properties are coming onto the market. There were actually 0.5% fewer new listings than last year.

Instead, properties are taking longer to sell.

REINZ says the typical property took 50 days to sell in July, two days longer than a year ago.

In simple terms, homes aren’t selling as quickly as they’re coming onto the market.

That gives buyers more properties to choose from, more time to make a decision, and more room to negotiate.

And buyers themselves have cottoned on to that. More Kiwis think it’s a good time to buy than a bad time, according to ASB’s latest Housing Confidence Survey (September 2026).

Pro #3 – The rental market is starting to turn

Finding a tenant started getting tougher in mid-2024. More investors reported it was harder to find a good tenant. And the median rent across the country stopped going up around the same time.

But there are early signs the rental market is starting to shift back towards landlords.

In June 2024, rental searches on Trade Me were down 13%, while new rental listings were up 14%.

Fast-forward two years and it’s almost the opposite.

Tenant searches are now up 16% year-on-year while new rental listings are up just 4%.

Landlords are starting to notice the change too.

Tony Alexander’s June 2026 survey found a net 29% of investors said it was difficult to find a good tenant.

That’s still high, but it’s down from 43% in November 2025.

None of this means rents are suddenly about to take off. National rents were up just 1% over the year to June.

But tenant demand is now growing faster than the number of properties coming onto the market.

If that continues it should become easier for some investors to find tenants and could eventually put upward pressure on rents.

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3 reasons NOT to invest in property in 2026

Now for the other side.

Because none of that means you should rush out and buy a property tomorrow.

There are still some pretty significant reasons to be cautious.

Con #1 – House prices could fall further, and recovery could take years

There is no guarantee NZ house prices are definitely at the bottom of the market. There is always a risk they could fall further. 

Wellington City property prices fell 6.5% in the year from August 2025 – 2026. 

Even if the market is near the bottom, it doesn’t mean house prices will immediately start rising.

So, if you’re buying in 2026 expecting to make a quick $100,000 in capital growth, you could be disappointed.

You may need to own the property for several years before you see substantial growth.

That’s why property generally suits a long-term investor rather than someone looking to make a quick buck.

Con #2 – Interest rates are heading up again

The OCR is now 2.75%. And the Reserve Bank says it may need to increase further.

That matters because when the OCR goes up, mortgage interest rates can go up too.

For property investors it can affect you in two ways.

For starters, your mortgage gets more expensive.

Say your rental income stays the same, but your mortgage costs an extra $100 a week. That’s another $5,200 a year you need to find.

But higher interest rates can also affect house prices.

That’s because buyers generally can’t borrow as much when interest rates are higher. If buyers have less money to spend, that can take some of the heat out of house prices.

How much this affects you depends on how much you’ve borrowed.

If you’ve got a small mortgage another increase might not change much.

But if you’ve borrowed a lot … it matters a lot.

Con #3 – Property investors’ costs have risen 

Buying the property is one thing. You also have to afford to keep it.

Council rates have risen sharply. The median rates bill across New Zealand increased 14.2% in 2024/25, followed by another 9.2% increase in 2025/26.

Put those increases together and that’s roughly a 25% increase in just two years. That’s before you factor in insurance, maintenance and mortgage costs.

The Government has proposed limiting annual rate increases to 2 - 4%. But the legislation has only passed its first reading, and the caps aren’t proposed to fully take effect until July 2029.

So, should you invest in property in 2026?

The truth is that some people should invest in 2026 and others probably shouldn’t. 

And that’s because different investors care about different things.

If you’re buying properties with a big mortgage you’ll likely care more about interest rates. If you’re focused on cashflow, rents and rising costs matter more.

But if you’ve got the money to comfortably hold a property long term, buying around 17% below the peak could look attractive.

So don’t ask: “Is 2026 a good time to buy?” Ask: “Is 2026 a good time for me to buy?”

Because the right time to invest isn’t when the market is perfect … it’s when the numbers work for you.