CoreLogic compared the median values between three and four bedroom properties across the country for the study (file picture). Photo: RNZ / Nate McKinnon
The downturn in property values over the past year has an upside for homeowners looking to move to a bigger place.
Property research firm CoreLogic's annual report on the so-called 'trade-up premium' - the amount of extra equity or debt homeowners need to pay to move up the housing ladder - shows it has shrunk in most parts of the country.
CoreLogic compared the median values between three- and four-bedroom properties across the country.
Despite the fall in values, it showed the extra cost of buying a bigger home remained high, ranging from about $150,000 in Upper Hutt and Dunedin to more than $500,000 in Auckland.
Chief property economist Kelvin Davidson said despite high mortgage rates, people keen to upsize would be assessing their options.
"These figures are showing that you don't have to raise as much money to get that trade in the first place. So yes, mortgage rates are higher but at least you don't need to take on as much debt to achieve that trade-up.
"So, I think if confidence returns a little bit and that pent-up demand is still there - because let's face it, people's life circumstances do change - and even if the finances are tough, people will still try and find a way [to buy]."
Davidson said mortgage rates had probably peaked, or were about to, which offered more certainty to mortgage holders.
Trade-up premiums 2022 vs 2023 in main centres
- Auckland City (excluding Franklin, Manukau, North Shore and Rodney) $520,000 vs $531,000
- Christchurch $255,000 vs $235,000
- Hamilton $237,000 vs $225,000
- Wellington City (excluding Hutt and Porirua) $252,000 vs $213,000
- Tauranga $247,000 vs $210,000
- Dunedin $177,000 vs $158,000
