The lifestyle dividend

In New Zealand, luxury home buying is different to almost anywhere else. 

Compared with peer markets like Sydney or Melbourne, New Zealand’s prestige market has a smaller stock pool and low turnover, shaped by geography and planning settings. With fewer homes trading hands, and foreign-buyer rules concentrating offshore demand into a narrow band of luxury properties, competition at the top end can be intense.

New Zealand's high-net-worth buyers and sellers are sophisticated and typically well informed. It’s a market where emotion still matters, but decisions are balanced between aspiration and shrewd judgement.

As economic uncertainty lingered in 2025, apprehension appeared to be the mood across the board. But prestige buyers tend to move methodically in any cycle, doing deeper due diligence and comparing fewer, higher-priced options. The difference in 2025 was that, despite the measured pace, well-capitalised buyers still acted decisively when the right property appeared, and activity at the top end lifted.

REINZ’s 2025 year-in-review* gives the overall market scoreboard: sales volumes rose 10.3% to 80,655, while the national median price edged 0.6% lower to $775,000. Inventory climbed too, up 5.9% year-on-year, giving buyers more choice and more negotiating power.

In contrast, the luxury market showed active resilience and growth. Across the New Zealand Sotheby’s International Realty network, we delivered a 39% increase in sales $5m and above and the value of those sales rose 47%, outperforming the market and demonstrating sustained momentum within the prestige segment.

Ben Macky, Director of New Zealand Sotheby’s International Realty North, says the defining feature of 2025 was the breadth of demand at the top end.

“What stood out last year was the diversity and depth of the buyer pool. We saw strong activity from local upgraders and downsizers, a noticeable return of New Zealanders coming home, and increasing interest from investor-residency buyers actively searching for premium homes,” he says.

“That combination created competition in a market where quality supply is already limited.”

The forces shaping the year ahead

Mortgage forecasts suggest rates are likely to edge up slightly this year, settling somewhere in the low-to-mid 6% range. High-net-worth buyers are usually less affected by rate changes, but stability still matters. It supports future planning, clarifies ownership costs and gives buyers a sense of control.

“Luxury buyers don’t always rely heavily on debt, but predictability in monetary settings supports long-term decision-making for both buyers and vendors,” Macky says.

Macky also cites improving business confidence: “Many premium buyers are business owners, executives, or professionals. As economic uncertainty eases, lifestyle and relocation decisions become easier to justify.”

Government policy settings are evolving too. From 2026, a wider group of foreign buyers will be permitted to purchase homes in New Zealand under defined criteria, with the change expected to be most relevant at the upper end of the market. It reinforces New Zealand’s appeal to international buyers seeking long-term stability rather than short-term gains, and adds another layer of demand in a segment already shaped by scarcity.

“The investor-residency and global investor pathways are bringing a new wave of very well-capitalised buyers into the premium market,” Macky says. “When you combine that with an already tight supply of best-in-class homes, it’s likely to result in increased competition at the top end.”

“Local buyers are becoming more aware that they are increasingly competing with well-capitalised offshore and investor-residency buyers,” he says.

Lifestyle is driving choice

In our Q4 2025 Property Pulse survey, lifestyle comes through as a defining driver of premium demand. Seventy-three percent of agents say luxury buyers are primarily driven by where a home sits, while outlook, proximity to water, privacy and a turnkey finish sit high on the shortlist.

Macky says lifestyle and security are now the clearest motivations at this level. “Most buyers aren’t chasing short-term capital gains. They’re making long-term decisions around family, schooling, privacy, proximity to the coast, and quality of life,” he says. “Scarcity reinforces those decisions. Buyers understand that genuinely irreplaceable properties, particularly in coastal and lifestyle settings, tend to protect value over time.”

And importantly, traditional lifestyle markets, like Waiheke Island and Queenstown, continue to command attention because lifestyle-led homes remain a priority for high-net-worth families. People still want dramatic settings, easy access to amenities, safe communities, and genuine architectural distinction.

The 2026 takeaway

Taken together, these signals point to a premium market that remains compelling on two fronts in 2026. As an investment, luxury property continues to be supported by low stock, demand for quality and long-term desirability - fundamentals that hold their value through wider market cycles. As a lifestyle choice, the ‘return’ is measured in space, privacy, community and a stronger connection to the outdoors - in a home that’s ready to enjoy from day one.

*2025 in Review – How New Zealand’s Property Market Shifted From 2024