Almost 20 percent of townhouses changed hands in Q1 2026 for less than their purchase price, according to Cotality data. The median loss was $49,500, and Auckland agents say new developments with incentives are squeezing second-hand townhouse owners trying to resell.
New data confirms what many Auckland townhouse owners have suspected: the market for townhouses has been significantly weaker than for standalone houses, and a substantial portion of resales are happening at a loss.
According to Cotality, 18 percent of townhouses sold in the first quarter of 2026 changed hands for less than their owners paid. That compares with 11 percent of standalone houses and 41 percent of apartments. The median loss across all townhouses that sold at a loss was $49,500.
The figures do not include the costs of selling — real estate commissions, marketing fees, and other transaction costs that would increase the effective loss for any seller who bought and sold within the same period.
What is driving the townhouse loss rate
The townhouse market has been pressured by a specific combination of factors. Supply has increased substantially: there are now 242,000 townhouses across the country, 48,000 more than eight years ago. That increase in supply has given buyers significantly more choice, which tends to moderate prices.
For second-hand townhouse owners, the competition is not only from other existing properties but from new developments still being sold with incentives. Auckland real estate salesperson Diego Traglia said brand new developments frequently offer cashback, low deposit structures, upgraded appliance packages, or flexible settlement terms — none of which a second-hand owner can match. That creates direct price pressure on anyone trying to sell a townhouse bought during the 2021 to early 2022 peak period.
Cotality chief property economist Kelvin Davidson said the townhouse market weakness was expected given the supply that had gone into the market, but noted the segment was not "totally collapsing" — the losses are real but concentrated in certain segments and locations.
The Epsom examples
Two specific resales in St Andrews Road, Epsom — one of Auckland's most expensive suburbs — illustrate the scale of losses some owners have faced. One townhouse bought for $2.15 million in 2022 resold for $1.55 million in March. Another bought for $1.99 million resold for $1.65 million in February. Both sales represent losses of hundreds of thousands of dollars, before transaction costs.
Townhouses make up 13 percent of all housing stock and 12 percent of all listings. The concentration is highest in Auckland, where higher land values have historically made townhouse development particularly attractive to developers.
What this means for the market
The loss rate data reflects a market that had a clear peak in 2021 and early 2022, when low interest rates and strong demand pushed prices to historically high levels. Properties bought during that period and not held for a significant time are now reselling into a market with more supply, higher mortgage rates, and more cautious buyers.
The broad pattern is not unique to townhouses, but the segment has been more exposed than houses because of the speed of new supply arriving and the competitive pressure from developer incentives. The 18 percent loss rate is a reminder that property values do not always move in one direction, and that the cost of owning and selling a property can be substantial even when the overall market is not falling dramatically.
This article is for general information only and is not personalised financial advice. Seek advice from a licensed financial adviser (registered on the FSPR) for guidance specific to your situation.