What elections really mean for buyers and sellers

As we head towards another election, the political conversation is saturating headlines. Tax settings and the cost of living are competing for voters’ attention, while buyers and sellers are left wondering whether a change of government could also change the trajectory of the property market.

For some, uncertainty can be enough to delay a decision.

But an analysis of previous elections by Bayleys Insights suggests the ballot box itself has far less influence than the market narrative implies – and that when an election does leave a mark, it is on transaction volumes rather than prices.

“Our analysis shows there is no consistent ‘election effect’ on the housing market,” says Bayleys Head of Insights, Data and Consulting Chris Farhi. “The driving factor is whether housing policy becomes a major part of the political debate.”

To test the idea, Bayleys split sales activity into quarterly periods and compared the quarters leading up to an election with the same quarter in the year before and after.

The result is a useful reality check for anyone considering the timing of their property decisions relative to the election.

It depends on whether housing is on the ballot

Across past election cycles, there is no single pattern. Some elections were linked with higher sales activity, some showed little change, and others were softer.

The common thread is how prominent housing was in the political debate.

In 2014 and 2017, when housing affordability and property-related policies were front and centre, activity was noticeably slower. Sales in those election quarters sat at 78 percent and 87 percent of normal levels respectively, with similar softness in the quarter beforehand.

“A big part of that was because housing policy was up in lights,” Farhi says.

“There was a lot of policy debate around issues like foreign buyer bans and bright-line tests, and that gave people a reason to pause.”

Where property issues were less contentious, the market simply carried on. In the most recent 2023 election, sales tracked at normal levels through both the election quarter and the one before it.

Importantly, prices show even less of a reaction than volumes. Even in the years where transactions dipped, there is little evidence of an election-driven shift in what people actually paid.

Correlation isn’t always causation

One reason elections can appear more influential than they really are is timing.

An election occurs against a much broader economic backdrop. Interest rates, credit availability, employment, migration, household confidence and the wider economic cycle can all exert substantially more pressure on property activity than politics alone.

The 2008 election is a prime example. Sales volumes fell to around 70 percent of normal levels, but that year coincided with the early phase of the Global Financial Crisis and a sharp deterioration in lending conditions.

“It’s very easy to point back and say it was the change of government, but it wasn’t,” Farhi says.

“The slowdown was global and financial in nature. The election just happened to fall inside that period.”

The 2020 election provides the mirror image. Sales ran at roughly 130 percent of normal levels heading into and through polling day, driven by pandemic-era stimulus and historically low interest rates rather than the election result itself.

The lesson for buyers and sellers is to distinguish between events happening around an election and those happening because of one.

What happened last time?

The 2023 election provides perhaps the most relevant recent case study.

House prices had bottomed around May that year and were starting their sluggish recovery. Prices have tracked sideways since, and sales volumes were largely steady.

The incoming National-led government subsequently implemented several significant housing policies, including restoring mortgage interest deductibility for residential property investors, shortening the bright-line test and changing residential tenancy settings.

Yet even these material changes did not translate into an obvious election-driven shift in house prices.

That does not mean government policy is irrelevant to property owners or investors. Tax rules and tenancy regulation can materially change the economics of owning a rental property, while infrastructure, planning and housing policies can influence supply over longer periods.

But policy changes do not operate in isolation, and their effects on national house prices can be overwhelmed by larger forces such as home loan rates and access to finance.

A different housing debate in 2026

Housing looks set to play a smaller role in this year’s election than it has in some previous cycles.

With rents relatively stable and prices down from their peak, housing affordability is a less heated political issue, and much of the policy programme promised at the last election – interest deductibility, a shorter bright-line period and tenancy changes – has already been delivered.

“A lot of people don’t remember how much has already changed,” Farhi says.

“The result is that housing is largely off the radar this time. The campaign conversation has been far more focused on the approach to taxation, cost of living, education, healthcare and crime.”

Tax is the one area still generating debate, with capital gains and land tax proposals in circulation. But Farhi expects that discussion to remain fairly contained.

“The market tends to discount the more extreme proposals because it simply doesn’t see them as credible.”

“People can propose whatever policies they want in an election year. It doesn’t mean they will become law.”

Coalition negotiations, parliamentary numbers and the compromises required to form a government can all substantially alter what ultimately survives beyond the campaign.

“The market also witnessed the removal and subsequent reintroduction of interest deductibility, so there is a sense that some policies can be unwound just as easily as they can be introduced”.

The evidence so far this year supports the steady view. Sales activity through the first half of 2026 has been broadly in line with the same period last year, even despite the Middle East conflict and oil shock, with no sign of an election slowdown emerging so far.

Far more important in 2026 will be the geo-political concerns, which have been the dominant force shaping the wider economic picture this year.

Should you wait until after the election?

For buyers and sellers, the historical evidence provides a relatively straightforward message: an election alone is unlikely to transform the property market, and this year it is likely to matter less than most.

Some purchasers will still hesitate. But history offers little evidence of a consistent election-induced change in house prices, and this cycle lacks the housing-policy flashpoints that drove the slowdowns of 2014 and 2017.

That means the more useful questions for homeowners remain personal and financial ones.

For sellers, considerations such as the quality of the property, local supply, competing listings, presentation, pricing strategy and the depth of buyer demand in their particular suburb may prove far more relevant than the date of polling day.

For buyers, mortgage affordability, available stock, personal circumstances and the ability to secure the right property remain critical.

Ultimately, elections create headlines, debate and uncertainty. New Zealand’s property market, however, has repeatedly shown that it is influenced by a much wider set of forces.

Because while governments change, property decisions remain deeply personal, and history suggests the market rarely waits for politics to make up its mind.