Wellington’s luxury housing market is showing signs of cooling, with prices for larger properties taking a significant hit in recent months.

According to Trade Me Property, asking prices for homes with five or more bedrooms in Wellington plummeted by 9.4% in May, second only to Auckland in terms of price decline. 

Trade Me spokesperson Casey Wylde noted that this trend isn’t unexpected, given that these properties are typically the priciest on the market.

The news comes as Trade Me’s Property Price Index recorded its second consecutive monthly decline, after showing promising growth earlier in the year.

While year-on-year prices remain up by a modest 0.9%, indicating an overall upward trend for the past four months, the pace of growth is slowing down from its March peak.

Wylde attributed this deceleration to a combination of factors, including rising interest rates and increasing council rates, both of which are putting a strain on homeowners’ finances.

“Many homeowners are currently refixing their mortgages at higher rates, forcing them to rethink what they can realistically afford,” she explained.

The data also revealed that properties are now spending longer on the market, with the median days on-site increasing to 68 in May.

“This extended time on the market often leads sellers to adjust their price expectations,” Wylde added, suggesting that further price reductions could be on the horizon.