Average vs median: Why house prices differ depending on where you look

If you’ve ever Googled the average New Zealand house price, you’ve probably noticed something confusing.

One website says the average house is worth about $906,000. Another says it’s around $770,000.

So, which one is right?

Both are. 

The difference comes down to what each source measures and how it calculates the result.

What’s the difference between an average and a median?

Imagine there are 10 houses.

Nine are worth $1 million, while one is worth $11 million.

Collectively, these 10 houses are worth $20 million. So, the average house price is $2 million. The expensive property pulls the average higher.

But the median is different. That’s calculated by lining up all the houses from the cheapest to the most expensive and looking at the one right in the middle. 

So, the average is $2 million. But the median is still $1 million. 

So, when it comes to property prices, it’s better to look at the median. 

However, where it gets even more confusing is that the ‘median’ is a type of average. So sometimes websites will talk about the ‘average’ house price. And what they really mean is the median.

I know it’s confusing. But that’s just how some property websites work.

Throughout this article, we use QV’s average property values. That's because they provide a consistent estimate of New Zealand’s entire housing stock. Rather than only the homes that happened to sell in one month.

Why are house prices reported by REINZ usually lower?

If you look carefully at the major property companies, you’ll notice that REINZ’s median sale price is often lower than QV or Cotality’s median house value.

That’s because REINZ’s data only looks at what sold in a given month.

Cheaper properties tend to change hands more often than expensive homes, which can stay with the same owners for decades.

So REINZ’s sales are concentrated at the more affordable end of the market.

That means REINZ is measuring a different mix of properties from QV. Its median sale price is therefore often lower than QV’s average estimated value.

Both are right; they just measure different things.

Where will house prices go over the next 12 months?

Most major forecasters expect New Zealand house prices to rise over the next 12 months.

But Ed McKnight, Resident Economist at Opes Partners, says homeowners and investors shouldn’t put too much weight on any single forecast.

“Forecasts are often wrong, and different regions can perform very differently even when the national market is rising.”

The chart below shows what that could mean in practice. Some regions have already returned to their previous peaks, while others could still be years away.

Where are the cheapest houses in New Zealand?

More from Opes Partners:

• What's happening with NZ house prices right now? (2024) (Article)
• Interest rates vs house prices: Should I wait till interest rates go down until I invest? (Podcast)

Where are the most expensive houses in New Zealand?

So, what should you do with this data?

People often ask me whether house prices are going up or down.

But the better question is: “What does that mean for me?”

The same house price data can mean very different things depending on where you are in your property journey.

For someone trying to buy their first home, falling prices can make home ownership more achievable. 

For an existing homeowner, rising prices might create enough wealth for their next move. 

For investors, rising house prices mean more wealth for their retirement.

But it doesn’t matter what happens at the national level. You really care about the areas where you want to buy or sell homes.

So, don’t stop at the national average. That number only tells part of the story. 

Property is a local market, and every suburb, town and city moves differently.

That’s why we’ve built the tools on this page. 

Use them to explore what’s happening in your area, compare different parts of New Zealand, and make decisions based on the data … not just the headlines.