The latest Auckland Economic Update for March 2025 from Auckland Council provides a comprehensive snapshot of the region's economic performance. Compiled by Economic Analyst Ross Wilson, this report delves into key indicators, offering valuable insights into the current state and recent trends of Auckland's economy. This blog post highlights the crucial findings from the update.
Housing Market Adjusts: Auckland's housing market continues to see adjustments. The median house price in January 2025 was $949,000, which is 4% lower than a year ago and 37% below the 2021 peak. This price level is similar to what was seen nine years prior, in 2015/2016. Despite the price decrease, the volume of house sales has seen an increase, with 21,977 houses sold in the year ended January 2025, marking a 20% rise above the May 2023 trough and a continuous increase since September 2024. However, sales volumes remain 40% below the July 2021 peak.
Rental Market Sees Slight Dip: The rental market in Auckland has experienced a minor decrease. The average weekly rent in December 2024 was $690, representing a 1% decrease compared to the previous year. This "real rent" level, adjusted for CPI inflation, is broadly similar to the last several months but below most of the last eight years. In comparison, the average weekly rent for the rest of New Zealand was $599.
Building Consents Decline from Peak: The number of new dwellings consented in Auckland in the year ended January 2025 was 13,921, which is 37% lower than the September 2022 peak and 7% below the 2019/2020 pre-Covid peak. However, there has been a slow increase in consents since July 2024. The real value of new non-residential buildings consented reached $2,487 million, a 17% decrease year-on-year and below nearly all of the last four years, although still 10% above the 2020 trough.
Employment Falls, Unemployment Rises: Auckland's labor market indicates a weakening trend. Employment declined by 2.0% year-on-year in the December 2024 quarter, marking the sixth consecutive quarter of falling annual growth despite population growth. Consequently, the unemployment rate increased to 5.3% in the December 2024 quarter, the highest-equal since the 2020 Covid lockdowns and above most of 2017 to 2024 levels.
Economic Growth and Retail Sales Contract: Auckland's real Gross Domestic Product (GDP) for the year ended December 2024 was 0.6% lower than the previous year, slightly more than the 0.4% fall experienced in the rest of New Zealand. This growth rate is below most periods since 2010 and has been falling since mid-2023. Real retail sales in Auckland also saw a significant decline of 4.3% for the year ended December 2024, compared to a 3.1% fall in the rest of New Zealand. Both retail sales growth rates are among the lowest since 2009, even considering the 2020 Covid lockdowns.
Confidence Shows Mixed Signals: Despite some economic headwinds, business confidence in Auckland is notably positive. A net 27% of businesses expect an improvement in the general business situation over the next three months, the highest since 2016 and the highest December since 2014. Consumer confidence, as measured by the Westpac McDermott Miller Consumer Confidence Index (CCI), stood at 106.5 for the December 2024 quarter, the highest-equal since 2021, indicating more optimism than pessimism, although below the levels of 2013 to 2018.
Imports See a Slight Decrease: The real value of imports by Auckland seaports for the year ended January 2025 was $30.0 billion, 3% lower than the previous year but 15% higher than the 2020 Covid trough. This is similar to the rest of New Zealand, which saw a 6% year-on-year decrease.
In conclusion, the Auckland Economic Update for March 2025 reveals a complex economic landscape with a cooling housing market, a slight dip in rents, and declining building consents from previous peaks. The labor market shows signs of weakening with falling employment and rising unemployment. While economic growth and retail sales have contracted, business confidence remains strong, contrasting with a moderately optimistic consumer sentiment. These insights provide a valuable overview for understanding the current economic trajectory of the Auckland region.
Key Highlights
- House Prices: Median price for January 2025 was $949,000 (4% lower than a year ago, 37% below the 2021 peak)
- Sales Volume: 21,977 houses sold in the year ended January 2025 (20% above May 2023 trough)
- Weekly Rent: Average $690 in December 2024 (1% lower than a year ago)
- Building Consents: 13,921 new dwellings consented in year ended January 2025
- Employment: 2.0% decline year-on-year in December 2024 quarter
- Unemployment Rate: Increased to 5.3% in December 2024 quarter
- GDP: 0.6% lower than previous year (Auckland), 0.4% lower (rest of NZ)
- Business Confidence: Net 27% of businesses expecting improvement (highest since 2016)
Real GDP Growth
Auckland's real* Gross Domestic Product (GDP) for the year ended December 2024 was 0.6% lower than for the year ended December 2023; in the rest of New Zealand, the annual change was 0.4% fall. Both growth rates were: below most periods since 2010; falling since mid-2023; lower than recent population growth; nearly as low as the Covid-related trough of 2020; above the GFC-related trough of 2009.
* Real GDP refers to GDP in constant 2022 dollars, to remove inflation.
Lockdowns due to Covid-19 affect results for 2020 onwards. Covid-19 lockdown level 3 began on 23 March 2020.
Source: Infometrics, Regional Economic Profile/Quarterly Economic Monitor. Latest and historical real GDP figures are modelled estimates, and subject to revision.
Real Retail Sales Growth
Real* retail sales for the year ended December 2024 were 4.3% lower than for the year ended December 2023; in the rest of New Zealand, the annual change was a 3.1% fall. Both growth rates were among the lowest since 2009 (just after the Global Financial Crisis), even including the 2020 Covid lockdowns. Both growth rates have been falling since late 2022, although the rate for rest of New Zealand recovered slightly in late 2024.
* Real retail sales have been calculated by converting previous quarters' dollars to the latest quarter's equivalent dollars using the quarterly consumer price index (CPI), to remove inflation.
Source: Stats NZ, Retail Sales (quarterly); Stats NZ, CPI (quarterly); Auckland Council calculations. Note: These figures exclude non-retail activity captured elsewhere in the retail sales survey.
Real Weekly Rent
The average weekly rent for the month of December 2024 was $690 (in real* dollars: broadly similar to the last several months, e.g. 1% lower than a year ago; below most of the last eight years). For the rest of New Zealand, the figure was $599: rising due to seasonality; similar to a year ago, following over three years of minimal increases.
"Real rent" changes are relative to CPI inflation, so a similar "real" level means rents rose at a similar rate to inflation.
* Real rents have been calculated by converting previous quarters' dollars to the latest quarter's equivalent dollars using the quarterly consumer price index (CPI), to remove inflation.
Source: Ministry of Business, Innovation and Employment, Regional Rental Prices (monthly); Stats NZ, CPI (quarterly); Auckland Council calculations. Note: Dwelling size and quality may vary over time. Rent is for new rental bonds lodged each month with Ministry of Business, Innovation and Employment, for housing tenancies with private sector landlords (so excludes state housing). Data covers only new bonds.
Real Imports by Seaports
The real* value of imports by Auckland seaports for the year ended January 2025 was $30.0 billion, which was 3% lower than the year ended January 2024, but 15% higher than the 2020 Covid trough. For the rest of New Zealand, the figure was $30.5 billion: 6% lower than a year ago, and 25% lower than the 2023 post-Covid rebound peak. For most of 2024, import values for Auckland and the rest of New Zealand were similar, and both showed a slight downtrend.
* Real import values have been calculated by converting previous quarters' dollars to the latest quarter's equivalent dollars using the quarterly consumer price index (CPI) for tradables, to remove inflation.
Source: Stats NZ, Overseas Cargo Statistics-imports-value $ CIF (monthly); Stats NZ, CPI Tradables (quarterly); Auckland Council calculations. Note: Import values are cost including freight (CIF). Auckland seaports consist of Port of Auckland on the Waitemata Harbour near the CBD, and Port of Onehunga on the Manukau Harbour (domestic only, no imports); both are owned by Ports of Auckland Limited (POAL).
House Sales: Price and Number Sold
The median (not average) sale price of houses sold in Auckland in the month of January 2025 was $949,000 (in real* dollars: similar to nine years ago (2015/2016); 4% lower than a year ago; 6% below December ($1.01 million); 37% below the 2021 peak).
The total number of houses sold in Auckland in the year ended January 2025 was 21,977: 20% above the May 2023 trough, and rising continuously since September 2024, but still 40% below the July 2021 peak.
* 'Real' prices for previous months are calculated by inflating previous quarters' dollars to the latest quarter's equivalent dollars, using the quarterly consumer price index (CPI).
Source: Real Estate Institute of New Zealand (REINZ), Monthly Property Report (monthly – from website); Stats NZ, CPI (quarterly); Auckland Council calculations. Notes: The data for 'houses' covers actual sales during the period. Size and quality may vary over time. 'Houses' includes all dwelling types (eg apartments and flats), not just free-standing houses, but excludes sales of undeveloped land. 'Price' is real actual sale price (not just listed).
Buildings Consented
The total number of new dwellings consented in Auckland in the year ended January 2025 was 13,921: 37% lower than the September 2022 peak; 7% below the 2019/2020 pre-Covid peak five years ago; rising slowly since July 2024.
The real* value of new non-residential buildings consented in Auckland in the year ended January 2025 was $2,487 million: 17% below a year earlier; below nearly all of the last four years, and 28% below the November 2022 peak, but 10% above the 2020 trough.
* 'Real' values for previous months have been calculated by inflating previous quarters' dollars to the latest quarter's equivalent dollars, using the capital goods price index (CGPI) for non-residential buildings.
Source: Stats NZ, Building Consents (monthly); Stats NZ, CGPI (quarterly); Auckland Council calculations. Note: Projects consented are not necessarily commenced or completed. "New" refers to new buildings (i.e. excludes alterations and additions). Residential number is new dwellings consented, which will exceed new residential buildings as some buildings have multiple dwellings.
Employment and Unemployment
The number of people employed in Auckland in the quarter ended December 2024 was 2.0% lower than in December 2023 quarter: the sixth quarter in a row of falling annual growth rates despite population growth.
The unemployment rate in Auckland in the quarter ended December 2024 was 5.3%: the highest-equal quarter since the 2020 Covid lockdowns, and above most of 2017 to 2024, but still lower than 2009 to 2015 and late 2020.
Source: Stats NZ, Household Labour Force Survey (HLFS) (quarterly). Note: Covid-19 lockdowns began on 23 March 2020, plus wage subsidies, which both affect official unemployment. Employment data is rebased by Stats NZ each quarter to match latest revisions of historic population estimates. Both datasets are from a survey so are subject to error margins. Respondents define their own employment status.
Confidence Indicators
In Auckland, the Westpac McDermott Miller Consumer Confidence Index (CCI) for the December 2024 quarter was 106.5: the highest-equal since 2021, but below 2013 to 2018.
The NZIER QSBO in Auckland for the December 2024 quarter showed a net 27% of businesses expecting the general business situation to improve over the next three months – the highest quarter since 2016, and the highest December since 2014.
Source: Westpac McDermott Miller, Regional Consumer Confidence Index (CCI) (quarterly – published, but proprietary); New Zealand Institute of Economic Research (NZIER), Quarterly Survey of Business Opinion (QSBO) (quarterly – by subscription). Note: For the CCI, a score of greater than 100 shows more optimism than pessimism. The QSBO calculates a net figure as (% of businesses expecting an improvement) minus (% expecting a worsening).
Notes on the Data
'Real' values are calculated by adjusting for inflation, using the appropriate price indices. This allows for meaningful comparisons over time.
Data is the latest available as at the start of the month and is for the Auckland region, unless otherwise stated.
This is a summary page only. Full data sources and technical notes are available from Auckland Council.
Frequently Asked Questions: Auckland Economic Update - March 2025
1. What is the current state of Auckland's housing market according to the latest data?
The Auckland housing market shows a mix of trends. The median house price in January 2025 was $949,000, which is 4% lower than the previous year and significantly down (37%) from the 2021 peak. However, the volume of sales has increased, with 21,977 houses sold in the year ending January 2025, a 20% increase from the May 2023 trough and a continuous rise since September 2024. Despite this increase, sales volume remains 40% below the July 2021 peak. Real weekly rent in December 2024 averaged $690, slightly (1%) lower than a year ago.
2. How has Auckland's economy performed in terms of GDP and retail sales compared to the rest of New Zealand?
Auckland's real GDP for the year ended December 2024 was 0.6% lower than the previous year, slightly worse than the 0.4% fall experienced in the rest of New Zealand. Both regions saw growth rates below most periods since 2010 and a decline since mid-2023. Real retail sales in Auckland also saw a significant decline of 4.3% year-on-year, compared to a 3.1% fall in the rest of New Zealand. Both these declines are among the most substantial since the Global Financial Crisis in 2009.
3. What are the recent trends in employment and unemployment in Auckland?
Auckland's employment figures indicate a weakening trend. The number of employed people in the December 2024 quarter was 2.0% lower than the same period the previous year, marking the sixth consecutive quarter of falling annual growth despite population increase. Consequently, the unemployment rate has risen to 5.3% in the December 2024 quarter, the highest it has been since the COVID-19 lockdowns in 2020 and above most rates observed between 2017 and 2024.
4. How does the level of building consents in Auckland compare to previous years?
The number of new dwellings consented in Auckland in the year ending January 2025 was 13,921. This figure represents a significant decrease of 37% from the peak in September 2022 and is also 7% below the pre-COVID peak of 2019/2020. However, there has been a slow increase in consents since July 2024. The real value of non-residential buildings consented also declined by 17% year-on-year, falling below nearly all of the last four years, although it remains 10% above the 2020 trough.
5. What do confidence indicators suggest about the future economic outlook for Auckland?
Despite some negative economic indicators, confidence levels in Auckland show a more optimistic outlook. Consumer confidence, as measured by the Westpac McDermott Miller Consumer Confidence Index, reached its highest-equal level since 2021 in the December 2024 quarter. Business confidence is even more positive, with a net 27% of businesses expecting an improvement in the general business situation over the next three months, the highest since 2016 and the highest December result since 2014.
6. How have Auckland's import levels through seaports changed recently?
The real value of imports through Auckland seaports for the year ended January 2025 was $30.0 billion, a 3% decrease compared to the previous year. However, this is still 15% higher than the 2020 COVID-19 trough. Import values for Auckland and the rest of New Zealand were similar for most of 2024, both showing a slight downward trend. The rest of New Zealand experienced a larger year-on-year decrease of 6% and is 25% below its 2023 post-COVID rebound peak.
7. What does it mean when economic figures are reported in "real" terms in this update?
The term "real" in this context indicates that the economic figures have been adjusted for inflation. This adjustment uses various price indices, such as the Consumer Price Index (CPI) for retail sales and rent, and the Capital Goods Price Index (CGPI) for non-residential building consents. By presenting data in real terms (constant 2022 dollars for GDP), it allows for more accurate comparisons over time by removing the distorting effects of price changes.
8. Where can I find more detailed information and technical notes related to this economic update?
This document is a summary, and further details, including the full data sources and technical notes, are available from Auckland Council. For specific enquiries, you can contact the author, Ross Wilson, Economic Analyst at the Strategic Advice and Research Unit, via email at Ross.wilson@aucklandcouncil.govt.nz.
Disclaimer: The information in this document is provided in good faith, however, Auckland Council disclaims any liability whatsoever in connection with any action taken in reliance of this document, for any error, deficiency, flaw or omission contained in it.
Based on Auckland Council Economic Update – March 2025, compiled by Economic Analyst Ross Wilson. Read full analysis
Based on Auckland Council Economic Update – March 2025, compiled by Economic Analyst Ross Wilson. Read full analysis
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