Can we bet on The Bay? - Business News

After turbulent times, a resilient BOP real estate market could be on the cusp of recovery making for a happy New Year on the homes front, as Jon Rawlinson discovered.

Gudsell Designer Homes of Tauranga won the Mitre 10 Trade Craftsmanship award at the Master Builders House of the Year national awards for this new home in Ōtūmoetai.

Call it middle-of-the-road, run-of-the-mill, or nothing to write home about, sometimes average is more than just okay.

Kelvin Davidson

While Cotality (formerly CoreLogic) recently suggested there could be more pain before gains in real estate, it’s not quite so bad in the Bay.

“The Bay of Plenty is a bit more resilient than average,” Cotality’s chief property economist, says Kelvin Davidson.

“There’s still a bit of pain, but not as much as elsewhere.”

So, pretty good, glass half full, on the bright side, light on the horizon?

“The outlook for 2026 as a whole is for rising house prices and sales, but certainly not at the crazy post-pandemic levels. It’s hard to say how the Bay of Plenty will perform specifically, but I’d suspect it’d be somewhere in the middle of the pack.”

According to the latest Cotality Pain and Gain Report, property resale gains in the third quarter of 2025 fell to their lowest since 2013. However, Davidson says this is consistent with property values in many areas still significantly down from their 2022 high. Some have more ground to regain than others.

“What goes up must come down. Auckland and Wellington, for example, had big booms. Bay of Plenty still went up, but maybe it didn’t become as elevated or excessive,” Davidson says.

“The Bay has been relatively robust. You can get down into the weeds on that, but the bigger picture is that it’s been a more resilient part of the country.”

Urbo Homes Bay of Plenty-Waikato were finalists in the MasterBuilders new home $1.5 milion – $2 million category for this Lake Rotorua home.

A strong rural property market may have been helping ease the pain in regions associated with farming including BOP.

“Absolutely, and we’re seeing this in areas that aren’t primary sector driven as such, but they have a larger share of activity coming from the primary sector than others.”

Some quarterly reports have revealed a drop in house prices nationwide, including in Tauranga, towards the end of the year. Such short-term analysis must be considered in context, Davidson says.

“I wouldn’t say Tauranga’s entering a second downturn or whatever, it’s just normal variability at the tail end of the downturn.”

Another cut to the Official Cash Rate (OCR) towards the end of the year, as well as other ‘green shoots’, should help treat market pangs as the tide turns.

Calley Homes of Tauranga were finalists in the House of the year for this Mount Maunganui duplex development.

“It’s the same everywhere – borrowers are benefiting and this will support the housing market as we go into 2026 so we’ll see more sales probably at higher prices.”

A slow and steady upturn could be just what the doctor ordered.

“Price rises should be fairly modest compared to what we have seen historically just because supply has rebalanced to some extent over the past couple of years,” Davidson says.

“In general, the economy is picking up, interest rates are down. So, whether you’re in Auckland or the Bay of Plenty, it does feel like things are turning around.”

Duncan Hare Builders were finalists in the Master Buildings renovation $1 million – $2 million for this Lake Rotoiti lakeside bach building in the 1930s.

Meanwhile the Waikato and Bay of Plenty regions have shown a steady performance throughout 2025, on par with the activity that realestate.co.nz was seeing last year, company spokesperson Vanessa Williams says.