Market insight | 17 Sep 26

NZ election 2026: what could it mean for property?

With the 2026 election approaching, there are some significant differences between the major parties when it comes to property, taxation, housing supply and population growth.

We’re not here to tell you how to vote. But property is New Zealand’s largest asset class and, for many households, their biggest financial investment. So it is worth understanding how the different policy settings could affect property owners, investors and developers.

At its simplest, housing still comes back to supply and demand.

New Zealand’s population is continuing to grow over the longer term, which means we need to keep building homes—whether they are owned by first-home buyers, existing homeowners or investors.

Here is a look at what the major parties are proposing.

Labour

One of the most significant changes proposed by Labour is a 28% capital gains tax on residential investment property and commercial property.

Under the proposal, the tax would apply to gains made after 1 July 2027, with the tax paid when the property is sold. The family home, including lifestyle blocks, and farms would be exempt.

For example, if an investment property was valued at $1 million on 1 July 2027 and later sold for $1.3 million, the $300,000 gain made after that date would potentially be subject to the proposed tax.

Labour’s position is that the change would make the tax system fairer and redirect investment towards more productive parts of the economy.

For property investors and developers, the question is what effect a 28% tax on future gains would have on investment decisions and the financial viability of projects.

National

National is taking a substantially different approach.

The current Government has restored 100% mortgage interest deductibility for residential investment properties and reduced the bright-line period back to two years.

National is also proposing its Going for Housing Growth programme, which is centred on increasing the supply of land and infrastructure available for development.

The plan includes requiring major councils to zone enough land to meet 30 years of housing demand, making it easier for developers to fund infrastructure, and providing financial incentives for councils that enable additional housing.

The broader approach is therefore focused less on taxing property investment and more on addressing the supply side—making land, infrastructure and development easier to deliver.

Greens

The Greens are proposing significantly greater taxation of wealth and property investment.

Their current tax policy includes a 2.5% annual wealth tax on net assets above $10 million, with the family home exempt. They also propose reversing the current landlord tax changes and the reduction in the bright-line period.

The Greens argue these changes would create a fairer tax system and generate additional revenue.

For larger property investors, however, the proposed settings would represent a significant change from the current position.

ACT

ACT’s approach is focused more heavily on reducing the costs and regulatory barriers associated with development.

The party supports measures including sharing a portion of GST from new development with councils to encourage housing growth, reforming the Resource Management Act and making it easier to use building materials already approved in comparable overseas jurisdictions.

The underlying approach is to make it easier and less costly for the private sector to develop housing, rather than increasing taxation on property investment.

For developers, the important question is whether reducing planning, infrastructure and construction costs can make more projects financially viable.

New Zealand First

New Zealand First is approaching the housing question from a different direction again—particularly through population growth and immigration.

Its 2026 immigration policy proposes substantially reducing non-essential immigration and developing a 30-year Population Plan linking immigration, housing and infrastructure planning. It argues that population growth should not outpace New Zealand’s ability to provide housing and infrastructure.

That is relevant to property because population growth is one of the factors influencing housing demand.

If fewer people are entering New Zealand, the rate of demand growth could change. At the same time, slower population growth would need to be considered alongside the potential impact on labour supply, economic growth and development.

So what could this mean for property?

This is where the discussion becomes more interesting.

New Zealand needs people willing to invest in housing.

We need developers prepared to take the risk of buying land, subdividing it and constructing homes. We need investors providing rental accommodation. And we need enough housing supply to give first-home buyers more choice.

At the same time, we need housing to remain accessible to the people who want to buy it.

The debate is therefore not simply about whether property should be taxed more or less.

It is about what happens to new supply.

If taxes, development costs and regulation make fewer projects financially viable, there may ultimately be fewer homes built.

On the other hand, Labour and the Greens argue that changing the tax treatment of property could reduce investment in existing housing and redirect capital towards other parts of the economy.

There is also a separate question around demand.

National and ACT are primarily focused on increasing the ability to build, while New Zealand First is putting greater emphasis on managing population growth and immigration alongside housing and infrastructure.

These are different approaches to the same underlying issue.

The bigger property question

For anyone who owns property, is considering investing, or is looking at development, the important thing is to look beyond the headline policy.

Ask what each proposal could mean for:

• The cost of owning property - interest deductibility, taxation and other settings can change the after-tax return for investors.

• The viability of development - land, infrastructure, consenting and construction costs all influence whether a project stacks up financially.

• Housing supply - the number of homes that can realistically be brought to market will ultimately influence the balance between supply and demand.

• Housing demand - population growth, migration, household formation and economic conditions all influence how much housing is required.

• Investment decisions - changes to taxation and regulation can influence where investors choose to allocate capital.

There is no single policy lever that determines the property market.

Interest rates, employment, migration, construction costs, lending conditions, consumer confidence and the availability of land will all continue to play a role.

But one thing is relatively straightforward, if New Zealand’s population continues to grow, we need to build enough homes to accommodate that growth.

If supply does not keep pace with demand, pressure can build across both rents and house prices.

That makes the housing supply question particularly important when assessing any party’s property policy.

The 2026 election presents quite different approaches—from greater taxation of property and wealth, to reducing barriers to investment and development, to managing population growth more closely alongside housing and infrastructure.

For property owners, investors and developers, understanding those differences is more useful than simply looking at the headline.

Because ultimately, the question is not just what happens to property values?

It is what policy settings will encourage enough investment and development to build the homes New Zealand will need?