The New Luxury Real Estate Playbook: Why $5 Million Plus Properties Are Outperforming the General Market

If you read the property headlines, you would be forgiven for thinking the New Zealand housing market has been struggling. And at the median level, that narrative is broadly accurate. National median prices have remained relatively subdued, sales volumes have been mixed, and sellers in many parts of the country have had to work harder to achieve their desired price.

But those headlines miss something important: the premium end of the market is increasingly operating under a very different set of dynamics. For high-net-worth investors in Northland and Whangārei considering property as part of a broader wealth strategy, the market above $5 million deserves much closer attention.

A Structural Shift at the Top End

New Zealand Sotheby’s International Realty reported a significant increase in sales activity for properties valued above $5 million during 2025. Their luxury portfolio included transactions ranging from $5 million to well above $20 million, with strong activity across Auckland, Queenstown, and selected coastal regions.

This is not simply a short-term fluctuation. The luxury market is behaving differently because the buyers themselves are different.

At this level, purchasers are generally less sensitive to interest rate movements. Many are using limited leverage or purchasing entirely with cash. When interest rates rose sharply, the mainstream housing market slowed because mortgage affordability deteriorated. The premium market proved more resilient because many buyers at this level were not dependent on conventional bank lending to the same extent.

In other words, while the broader market slowed materially, the top end continued to transact.

The Policy Catalyst

Changes to the Overseas Investment Act that took effect in March 2026 have added a further dimension to the luxury market.

Eligible investor visa holders, including Active Investor Plus visa holders, can now apply to purchase one residential property in New Zealand where the property or combined land and build value exceeds NZD $5 million. That policy shift has materially improved the attractiveness of premium New Zealand property for internationally mobile families considering residency options.

Importantly, supply at this level remains extremely limited. The number of properties nationwide listed above $5 million at any one time is relatively small, particularly outside Auckland and Queenstown. When international demand increases against constrained supply, pricing dynamics can diverge significantly from the broader residential market.

Why Northland and the Bay of Islands Stand Apart

From our base in Kerikeri, we watch the Northland market closely. The Bay of Islands contains a number of properties that are genuinely irreplaceable. Coastal positions, island holdings, deep water access, and substantial land parcels are finite assets that simply cannot be replicated.

Properties at developments such as Ōmarino near Russell have achieved multimillion dollar sales to international purchasers, reflecting growing offshore interest in premium Northland real estate. One of the advantages of developments such as Ōmarino is that parts of the project were structured with Overseas Investment Office approval pathways already considered, reducing complexity for eligible international buyers.

Privacy also matters enormously at this level of the market. High net worth families are often looking for discretion, security, lifestyle quality, and long-term asset preservation as much as they are looking for a house.

The Bay of Islands offers a combination that is difficult to replicate internationally: waterfront living, relative privacy, political stability, and natural beauty, all within a developed legal and financial system. Compared with premium coastal property markets in Europe, Hawaii, or parts of Asia, many international buyers still view New Zealand luxury property as comparatively well priced.

Property as Part of a Broader Wealth Strategy

At BeaconPoint, we increasingly work with clients who view premium property as one component of a diversified wealth strategy rather than simply a lifestyle purchase.

For high-net-worth families, premium property can serve multiple purposes simultaneously. It may act as a long-term store of value, provide inflation resilience, generate potential rental income, and complement broader residency or succession planning objectives.

The key distinction is that premium property decisions are generally driven less by short term speculation and more by fundamentals. Scarcity of the asset, quality of the location, international demand, and the historical resilience of comparable properties all become central considerations.

That is a very different conversation from simply trying to predict the next movement in median house prices.

What the Market Is Telling Us

The broader New Zealand housing market remains relatively subdued by historical standards, with only modest price growth in many regions over the past year. But activity in the premium segment has remained comparatively resilient, supported by constrained supply, international interest, and improving policy settings for investor migrants.

Industry participants in the luxury sector continue to report solid inquiry levels for premium coastal and lifestyle property, particularly in globally recognisable destinations such as Queenstown and the Bay of Islands.

For investors, the message is relatively straightforward: not all parts of the property market move together. The drivers affecting median suburban housing are often very different from those influencing tightly held premium coastal assets.

How We Can Help

If you are considering property in Northland or Whangārei as part of a broader financial strategy, it is worth evaluating it alongside your other investments rather than in isolation.

What role should the property play within your wider balance sheet? How does it affect liquidity and diversification? Are there ownership structures such as trusts, companies, or LTCs that may be appropriate for your circumstances?

These are not questions with universal answers. But they are questions worth addressing before making substantial investment decisions, and we are well placed to help clients think through those issues carefully and strategically.

Dirk Mostert is the Director of BeaconPoint Private Wealth, based in Kerikeri, Northland. This article is general in nature and does not constitute personalised financial advice. Please contact us at beaconpoint.co.nz or call 09 929 9916.