Have you not recalled the actions during Helen Clark & John Key's reign over immigration? Recessions creates opportunities for people to move. For eg. they lose their job in the UK or in China and pick NZ to immigrate (and i'm speaking specifically the people that have the skills and meet the criteria to immigrate to NZ). Having a cousin that works in NZ Immigration, every tweak in the immigration policies comes from a reaction from gov't. When houses were depressed in price or appeared to during the GFC, NZ immigration opened up new categories to attract "wealthy buy your way into NZ" programs.
You seemed to have missed the historic fact of NZ houses. Again, look at the real returns on house prices in NZ compared to abroad. Over a 30 year period it's placed NZ at the top of most unaffordable in terms of avg incomes. If there was any significant house bubble crash, then it would reset prices... but it has not and we have not seen any burst in housing prices. My hats off for the NZ gov't for all those decades for maintaining that status.
Don't take my word on why houses gone out of control in NZ. Critics like Bernard Hickey has been talking about this over the decades. It's inaction by our gov't and if you look over the other thread here and you will see the same thing. None of the NZ gov't is serious about addressing affordable housing. They are only interested in keeping 'sustainable' housing which means, let's keep the gravy train rolling while the poor and needy are kicked off the tracks. Why? Because Jacinda Ardern said, "Majority of NZ retiree and investors hold their assets in houses... it would not be prudent to tax them". That was her excuse for not bringing in CGT on houses. So she did the next worse thing by implementing a 'bright line test' which she's extended it to 10 years ; which exacerbates the intent for buying houses as a vehicle for retirement as an investment fund. Like Kiwi Saver, it's investing for the long term. So any person that locks in a plan using houses will be difficult to exit if they sell before the 10 year threshold.
Show me where are the large price falls on NZ housing? We are still far far higher than pre-pandemic prices.