Christchurch Property Market Rebounds: Rates Fall, Opportunities Rise for Canterbury Buyers

The Christchurch property market is rebounding, with prices nearly back to pre-Covid peaks. Mortgage rates have dropped to three-year lows, creating a prime opportunity for Canterbury buyers and first-home buyers. Legal advice is key in this competitive market.

A market on the mend

The Christchurch property market continues to demonstrate remarkable resilience, with recent data showing the city is leading New Zealand's recovery from the post-Covid correction. As of August 2025, Christchurch property prices sit just $4,000.00 shy of their 2022 peak of $802,000.00 significantly outperforming Auckland and Wellington, who remain 17% and 20% below their respective highs.

This recovery comes at a particularly opportune time for Canterbury buyers, as mortgage rates have fallen to their most attractive levels in three years. The Reserve Bank's recent reduction of the Official Cash Rate to 3% on 20 August 2025 has prompted immediate relief for borrowers, with major banks now offering one-year fixed rates as low as 4.75%.

What Canterbury Buyers Can Expect

For those looking to enter the Christchurch market, conditions have improved significantly. The average property price now stands at approximately $798,000.00, having increased 1.4% over the past three months. This steady growth reflects strong fundamentals:

• Relative affordability compared to other major cities;
• Robust net migration (with 20% of new migrants to New Zealand settling in Christchurch); and
• Increasing buyer confidence.

First-home buyers are particularly active, representing 35-40% of recent market activity. Well-priced homes under $700,000.00 in suburbs like Redwood, Belfast, Bishopdale, Hornby and Broomfield are selling quickly, while the $800,000.00 to $1.3 million bracket is seeing increased competition from growing families looking to upsize.

Current Mortgage Rates: A Three-Year Low

The mortgage landscape has transformed dramatically from the peak rates of 2023. As of late August 2025, borrowers can access:

• One-year fixed rates: As low as 4.75% (BNZ, TSB, Westpac)
• Two-year fixed rates: From 4.75% (BNZ, TSB, Westpac)
• Three-year fixed rates: Starting at 4.95% (Westpac)
• Five-year fixed rates: From 5.39% (BNZ, Westpac)
• Floating rates: Averaging 6.15-6.29%

These rates represent significant savings for borrowers. For context, just 18 months ago, one-year rates peaked at 7.5%. Today's rates mean a typical $600,000 mortgage could save borrowers approximately $16,200.00 per year compared to peak rates.

Looking Ahead

While Christchurch's property market has shown resilience, buyers should note that inventory remains at historic highs, providing excellent choice and negotiating power. The rental market has also shifted, with stock up 20% year-on-year, creating opportunities for tenants and putting pressure on landlords to remain competitive.

Market experts predict continued growth of 5-7% nationally in 2025, with Christchurch well-positioned to benefit from this trend. The city's strong economic fundamentals, combined with ongoing construction activity in areas like Selwyn, suggest sustained demand moving forward.

Key Takeaways for Canterbury Clients

• Timing is favourable: With mortgage rates at three-year lows and property prices still below peak, conditions look to be favouring buyers.
• Choice is abundant: High inventory levels mean buyers can be selective and negotiate effectively.
• Act strategically: While rates have fallen significantly, they're unlikely to return to Covid-era lows. Current rates with "a 4 in front" represent good value in the current environment.
• Seek professional advice: Given the complexity of today's market, engaging a solicitor at the early stages of the process can help make it as easy as possible to either buy or sell your home. The Christchurch property market's recovery, combined with improving lending conditions, presents opportunities for both buyers and sellers. However, each transaction requires careful consideration of individual circumstances and market conditions.