Here's where housing is most affordable - and where it's becoming more

Housing affordability improved by 12.6 percent in the first quarter of this year, Massey University says.

It has released its latest home affordability report, which shows a drop in median house prices in many regions and a fall in mortgage interest rates, combined with an increase in incomes, helped make buying a house more affordable in the first three months of 2026.

Prices dropped in eight of the 16 regions the index tracks. The biggest fall was in Marlborough, where prices were down 11.5 percent. Nationally, the median house price dropped 1.6 percent.

Over the quarter, Marlborough had the biggest improvement in affordability, up 21.7 percent. The smallest improvement was in the West Coast, up 5.5 percent.

Over a year, house prices were up 3 percent, two-year fixed mortgage interest rates dropped 1.37 percentage points and average weekly earnings increased 3.49 percent. This pushed affordability up on a nationwide basis by 23.1 percent.

On an annual basis, the largest improvement in affordability was in Northland, where it lifted 32 percent.

Auckland's affordability improved 25 percent, Wellington's 24.3 percent and Canterbury's 23.4 percent.

Affordability was best in the West Coast of the South Island and worst in Auckland.

Report author Ashad Javed, a senior lecturer in property at Massey University, said since December 2024, there had been double-digit year-on-year improvements in affordability in most regions.

"In addition to lower mortgage interest rates, the reassessment of rateable values across most regions during 2024 has contributed to a significant decline in house prices, further improving affordability.

"Looking ahead, it is possible that the Reserve Bank of New Zealand (RBNZ) may increase the official cash rate (OCR) in its next monetary policy announcement. If this occurs, mortgage interest rates are also likely to rise, which could reduce housing affordability in future quarters."

Sign up for Money with Susan Edmunds, a weekly newsletter covering all the things that affect how we make and spend money