Let’s get one thing straight: Budget 2025 isn’t going to win any design awards. There are no champagne-popping headlines for property. No sweeping housing reforms. No investor is marching down Queen Street chanting “20% tax deductions for productive assets!”
And yet, I’m quietly bullish.
Because beneath the fiscal restraint and the political restraint (which are not the same thing), this Budget offers something property people should care about: a population that’s more likely to stay put, invest, and demand housing stability.
You can read the full Budget at a Glance here and the detailed Summary of Initiatives here. I did. Here’s what stood out to me:
The flagship “Investment Boost” is classic incentive economics. Businesses can now deduct 20% of new asset purchases in year one (not residential building though 😡 ), on top of normal depreciation. The Treasury reckons this will bump GDP by 1% and wages by 1.5% over 20 years. That’s not sexy, but it is structural.
Productive economies attract people. People need homes. Investors step up. Demand and supply stabilise. This is the compounding flywheel effect the property sector actually wants.
$6.8B in capital spend. Over $1B into hospitals. $700M for schools. These aren’t ribbon-cutting photo ops. They are foundational bets on community. When Auckland Hospital is upgraded and classrooms expand, people don’t relocate—they dig in.
The long game for housing is not about land—it’s about people. And people follow jobs, schools, hospitals, and good coffee. This Budget invests in everything except the coffee (sadly).
Raising contribution rates? Reducing high-income subsidies? Encouraging 16- and 17-year-olds to start saving? These are grown-up moves for a country that’s tired of seeing its talent jump on one-way flights to Brisbane.
And if fewer Kiwis leave, more stay. More renters, more buyers, more market depth. That’s your housing demand signal.
Among the Budget’s fine print is a not-so-gentle reminder that IRD is getting more money to beef up compliance. That includes property tax enforcement. If you’re still DIY-ing your rental income declarations and hoping for the best, stop. The audit light just turned green. The days of “she’ll be right” are done. IRD wants a seat at your kitchen table—and they’re bringing the spreadsheets.
So, Where Does That Leave Us?
No, Budget 2025 won’t flood the rental market with new homes overnight. But it lays track. Economic track. Population track. Compliance track.
Here’s what no one’s saying out loud: this Budget quietly affirms that population is policy. When you look past the tax tweaks and infrastructure lines, what emerges is a strategic bet on retention. This government is building a country it hopes Kiwis won’t want to leave—by restoring public services, tweaking KiwiSaver, and funding social cohesion through things like disability support, aged care transitions, and school attendance boosts. That’s not just good politics. It’s rental market strategy. You don’t get healthy yields or stable tenancies from GDP stats. You get them from a population that sees a future here and commits to it. Budget 2025 reads like an immigration policy for New Zealanders. That’s the real wildcard under the mild headline.
Sometimes, stability is the bold move. Boring, right?
But hey, what do I know?! Come along to our next keynote meeting to hear ASB Chief Economic Nick Tuffley speak more about the Budget and our economy in detail. Details and registration here.
Sarina Gibbon
Sarina Gibbon is the general manager of the APIA.
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