Market Update 6 October 2026: Why Due Diligence Matters More Than Gut Feel
Giving you exclusive insights into the New Zealand property market and keeping you updated with the latest in property investment concepts.
Buying a property is one of the biggest financial decisions most people will ever make. For many New Zealanders, a house will be the single largest asset they own, which makes it a major concentration of wealth in one investment.
New research suggests a lot of those decisions still come down to gut feel. Find out more in the market update below.
What the Research Found
Talbot Mills research, commissioned by insurer Suncorp, looked at how New Zealanders assess property risk when they buy. The headline findings:
49% of those surveyed admitted they relied on "intuition" rather than professional data or reports when deciding which house to buy
Only 57% considered natural hazard information when purchasing their most recent home
That means more than four in ten purchases were made without those risks being fully considered
What makes these numbers interesting is that buyers aren't indifferent to risk. In the same research, 78% of homeowners said they feel confident assessing property risks.
So there's a gap between how confident people feel and how much checking actually happens. And the research suggests the cause is less about carelessness and more about how hard the information is to find and interpret.
The Information Problem
When respondents were asked what stopped them from seeking natural hazard information, the answers were telling:
28% said they didn't know where to find it
20% said they didn't know what information was available
Where buyers did look, 59% turned to official council data. The next most common sources were family, friends and local knowledge, at 27%.
Suncorp chief executive Jimmy Higgins says natural hazard risk and insurance cost or availability ranked behind other purchasing factors, with only 54% and 47% of buyers respectively rating them as very important.
There is also a language barrier. Risk terminology can sound simple but be easy to misread. Take the "1-in-100-year flood":
52% correctly identified that it means a 1% chance of a flood of that size in any given year
34% thought it was so rare it was unlikely to happen in their lifetime
17% believed that if a major flood happened this year, the area would be safe from another for the next 99 years
Neither misreading is unusual, but both lead to underestimating risk.
"It's Consented, So It Must Be Fine"
Another assumption the research flagged is that a property that has been consented must be safe and insurable. That isn't necessarily the case.
Higgins says this is partly a legacy issue. Councils have historically consented developments without proper adaptation plans in place, or under pressure from developers to open up land that probably shouldn't have been built on.
The risk of building in those areas ultimately passes to whoever buys the property, which is why independent due diligence matters.
Why This Shows Up in Your Holding Costs
Risk isn't only about what could happen to a property. It also feeds directly into what you pay to own it.
Analysis run for Stuff by Simplicity chief economist Shamubeel Eaqub found the annual cost of rates, insurance and property maintenance has risen from about $4,946 in 2016 to $9,100 today, an increase of 84%.
Dwelling insurance grew the fastest, at 123%. Over the same period the labour cost index, a measure of wage growth, rose about 35%. In other words, insurance costs have been rising far faster than incomes.
Part of that comes down to how global reinsurers, the companies that provide cover for locally operating insurers, view New Zealand.
A Cabinet paper accompanying the Government's Climate Adaptation Framework noted that uncertainty about New Zealand's exposure to risk was a contributing factor in reinsurers raising their premiums in the local market.
For buyers, the practical implication is that risk, or even unquantified risk, plays a major role in what you pay for insurance. Underestimate a property's hazard exposure, and you may face rising premiums for years to come.
What Might Change
The Suncorp research identified seven areas that undermine New Zealanders' ability to make informed property decisions. They include:
Natural hazard information not being consistently available at key decision-making moments
Information being fragmented across multiple sources
Technical risk language being difficult for households to understand
Property, lending and insurance processes not being well connected
No clear pathway to seek further advice when a hazard risk is identified
What Good Due Diligence Looks Like
The takeaway isn't to be nervous about buying property. It's that good due diligence is what separates a confident purchase from a costly surprise, and much of it needs to happen well before you're anywhere near an offer.
In practice, that means:
Looking at hazard information early, not once you've fallen for a property. Council data is the most common starting point, but natural hazard risk goes beyond flood maps.
Understanding what you're reading. Risk language like "1-in-100-year" is easy to misinterpret, so it helps to have someone explain what it means for the property in question.
Factoring ownership costs into the numbers. Rates, insurance and maintenance all affect returns, and insurance has been the fastest-growing of the three.
Not treating "consented" as "safe". Consent is not the same as a risk assessment.
Doing the checks before you go unconditional.
How We Approach It at Thrive
This is a big part of why working with a team that does the groundwork can lead to a better outcome.
Before a property is recommended to one of our clients, we look at what sits behind it, including the fundamentals of the area, the numbers, and the risks.
Once a client decides to move forward, we stay involved through the purchase process so that nothing important gets missed along the way.
The aim is simple: fewer surprises after settlement, and more confidence going in.
How Can We Help You?
We help Kiwis build wealth through property investment. Our advisors will take the time to understand your individual needs and recommend suitable investment properties to help you build wealth and set up your retirement.
What Does This Look Like?
We use a 3-step process:
We start with a Discovery Meeting where we learn about you, your goals, etc., and you learn more about us.
This is followed by a Strategy Meeting where we model your retirement plan, understand key investment concepts, and briefly touch on some investment choices.
Finally, an Asset Selection Meeting where we discuss investment options in more detail and make any recommended adjustments based on what we now know about you.
Who Are We Right For?
We help people make smart investment choices and set up their futures. From first-time investors to experienced investors, we can cater to a wide range of people and help set up their futures through research-based property investment.
How Much Does It Cost?
Our advice is free to you! If you choose to invest, we’re paid by the property developer. This developer-paid model allows us to provide no-obligation property investment advice in New Zealand, without charging clients directly.
What Do We Do, And What Don't We Do?
What We Do
We offer end-to-end New Zealand property investment advice, helping Kiwi investors grow wealth through smart, data-led decisions. Our focus is on quality new builds in strong locations, tailored to your goals, guided by a team that knows the NZ market inside out. What We Don’t Do
We don’t do KiwiSaver, shares, cryptocurrency, or broad financial planning. Thrive is not a generalist firm. We specialise in property investment in New Zealand because that’s where we deliver the most value. By staying focused, we cut through the noise and help our clients make confident, well-informed property investment decisions.
How Do I Start?
Start the process now by booking a time to talk with our advisor here.
