However, the median house price in New Zealand is an average of all the country’s property markets.

So Auckland house prices could be going up, while Wellington is flat. 

Or Hamilton property prices could be going up, while Palmerston North is flat.

That can make it look like property prices go up consistently. And that’s true, the country’s average is going up.

But, you’re not buying the average property in NZ. You’re investing in Auckland, or Christchurch, or Palmerston North etc. 

And in reality, the individual markets don’t go up as smoothly.

See how in this graph, Auckland and Gisborne property prices are more stop/start compared with the country’s average? 

Let’s dig into Gisborne a little more.

Since 1992, house prices there have grown around 7.25x. That’s pretty similar to the national average of 7.5x.

But the ride? Much bumpier.

• Gisborne’s worst year: Prices fell 21%
• NZ’s worst year: Prices fell 14%
• Gisborne’s best year: Prices surged 43%
• NZ’s best year: Up 31%

This is why you shouldn’t just buy in one area. 

Sure, long-term growth may even out, but the short-term bumps are much more pronounced in individual regions.

And if you’re only exposed to one ... you feel every hit.

When Andrew Nicol (Opes Partners Managing Director) was in his early stages of property investment he owned 10 properties ... all in Christchurch.

Then in 2011, the earthquakes hit.

It was a massive mistake; he could have lost everything. That’s when he started buying around the country. 

What to do instead

Let’s say back in 1992 you bought two properties – one in Auckland, one in Gisborne – both worth the same amount.

Over the next 31 years, each market had its ups and downs. Sometimes Auckland was booming while Gisborne was falling. Other times, it was the other way around.

But when you average out the values of both properties over time, your portfolio’s growth looks a lot smoother … it actually more closely mirrors the performance of the overall NZ property market.

This is why we diversify because then your overall portfolio can grow in value more smoothly (more like the national average) rather than having more stops and starts like if you just bought in a single region. 

More from Opes:

• What's happening with NZ house prices right now?
• How to time the market (the right way) with the property clock
• Investing in property now vs waiting 5 years

Why shouldn’t I try to buy at the bottom of the market?

The other type of diversification is buying at different times.

Investors often think: “I’ll just wait for the bottom of the market … that’s the best time to buy.”

But in practice it’s almost impossible to time the market perfectly. That’s because you can often only pinpoint the bottom of the market ... when you're looking back at it. 

For example, you might see that the S+P 500 dipped in April 2025. 

And in hindsight, that seemed the perfect time to buy. 

But even if you did have a crystal ball and knew it was the bottom of the market … would that be the cheapest price?

Well, no. Even though April 2025 looks like a bargain, prices were even cheaper in February 2024. 

Back in February 2024 you might have thought: “Share prices are up. I’m going to wait for the market crash.” 

But by the time the market crashed prices had already gone up. So the “bottom of the market” price was higher than if you’d just bought 2 years earlier.

The bottom of the market is not necessarily the lowest price you could have got.  

This is just as true in property. 

In Auckland, property prices bottomed out in July 2024. 

But property prices go up over time. If you bought at any time before September 2020, you got a lower price than the bottom of the market a few years later.

Similarly, Auckland house prices bottomed out in December 2008. But if you bought before January 2006, you got a lower price, too.

The bottom of the market is not the cheapest price … buying earlier tends to be.

Now that doesn’t mean you are blind to all market cycles, it’s just trying to break people out of the idea: “I’ve gotta get in at the bottom of the market. That’s how I get the cheapest price.”

Timing the exact bottom is a gamble. Time in the market matters more.

What does timing have to do with diversifying in property investment?

When house prices are falling, it can make sense to wait. 

For instance, if you bought in 2022, it’s likely your property has dropped in value.

And if you had known that was going to happen, you probably would have waited.

However, consistent investors can often outperform those who have the perfect timing. 

Here’s an example of what I mean.

Scenario: perfect timing vs consistent investing

Imagine two investors who started buying in Auckland in the year 2000.

Investor A: Buys consistently. They buy a new property every four years, rain or shine. Market's up? She buys. Market's down? Still buys.

By 2025, she owns seven properties and has spent $4.2 million in total. Some deals were better than others. But overall, she's ahead by $3.32 million.

Investor B: He’s got a sixth sense for timing the market and only buys at the precise bottom of each cycle, so he buy in 2000, 2009, 2015 and 2019. 

Same total spend: $4.2 million. Still a strong return. He's up $2.9 million.

Both did well, but Investor A – who didn’t try to time the market – came out $420,000 ahead.

Sure, change the city or the timing and you get a slightly different result. But the message stays the same:

Being consistent can sometimes beat being clever.

How does this diversification improve your property portfolio?

This smoother ride does two things.

#1 – You’re more likely to hold on

If you only invest in one region and property prices flatline, it’s easy to get discouraged. 

Gisborne investors who bought in 2007 faced a decade of flat prices. That’s enough to make anyone doubt the strategy.

A diversified portfolio gives you more consistent returns.

It makes it easier to keep investing if you own 2 properties and one of them is going up in value.

#2 – You can grow your property portfolio faster

Imagine one of your properties is in a slow market, but another’s booming. 

That increase in value gives you more equity. You might be able to borrow against that increase in value to buy your next property. Whereas if you only invested in one area, maybe you’d need to wait before you can afford the next one.

How can I lower my risk as a property investor?

Diversifying when you buy is just as powerful as where you buy. 

You won’t always hit the perfect market timing – and that’s OK.

Spread your investments across time and regions, and you won’t just ride out the bumps – you'll build a stronger, more resilient portfolio.

If you buy smart, and buy consistently, your portfolio is more likely to reflect the long-term performance of the overall market.

It's not just your properties that grow – it’s your ability to keep investing, no matter what the market throws your way.