House prices rose 0.4 percent in October, CoreLogic data showed on Wednesday, the first such increase in property values since March last year.
The October rise in house prices, to a national average value of $908,853, followed a flat September in the New Zealand market, according to the data.
Christopher Luxon, the incoming Prime Minister, has announced his government's intention to scrap the Brightline test extension and reintroduce interest deductibility on rental properties - which economists have said would support the housing market.
Kelvin Davidson, chief property economist at CoreLogic NZ, said it would still take time for prices to turnaround completely - noting there was "still a lot of diversity in market conditions across the country".
However, "the shift in voting to the centre-right seems to have bolstered housing market confidence, despite mortgage rates edging higher again recently", he said.
"We've also seen net migration rise to a new record high, which is boosting property demand."
Other factors helping the property market included strong employment and slightly relaxed loan to value ratios, Davidson said.
However, he said housing affordability was still stretched in many parts of New Zealand and "higher for longer" interest rates wouldn't do anything to ease that pressure.
Some economists have said cuts to the official cash rate, currently at 5.5 percent, were unlikely to commence until 2025.
"This 'recovery' could remain subdued by past standards, given that housing affordability is still problematic, mortgage rates aren't set to fall anytime soon and caps on debt-to-income ratios are still on the cards for 2024," Davidson said.
"First home buyers have remained a strong presence in the market over the past 12-18 months, recently hitting record highs in terms of their percentage share of purchases. On the flipside, mortgaged multiple property owners, including investors, have been quieter than normal, especially the so-called mum and dad group, who may be looking to buy their first rental or already have a modest portfolio.
"However, the next six to 12 months could be really interesting, with some investors looking to buy again, with a view to their tax bills being lower in the future. That means first home buyers could have some new competitive headwinds on the horizon."
