It is not uncommon to hear people talking confidently about how prices only ever go up.

Buyers are told they are on to a one-way bet when they purchase a property - just hold on tight for a few years and you'll be sitting on a goldmine.

But as recently as eight years ago, homeowners in New Zealand got a taste of what it's like when that doesn't happen.

Although it may now feel a distant memory, people who bought properties in 2008 had to wait quite some time before they saw the value of their homes recover to what they had paid for them.

It was particularly tough on first-home buyers, many of whom had been able to access 95 per cent or even 100 per cent mortgages in the lead-up to the correction.

WHAT HAPPENED?

You could describe it as a bit of a perfect storm.

House prices had been rising consistently year after year for some time, well outpacing income growth.

Then, New Zealand's economy went into a recession. The killer blow was the arrival of the global financial crisis (GFC). Real Estate Institute data shows that from their peak last cycle, house prices fell about 8 per cent nationwide before they started to recover.

CHARLOTTE CURD/FAIRFAX NZ People who bought just before the last market peak were particularly affected by the 2008 downturn.

But there were major regional differences. Northland house prices fell 26 per cent, and Southland's 25 per cent.

Auckland prices fell 8 per cent, Waikato's 10 per cent, Taranaki's 12 per cent and Hawke's Bay's 15 per cent. Canterbury dropped 11 per cent.

Economist Shamubeel Eaqub says there is a common misconception that the drop was purely due to the GFC. But he says it was the national recession that set prices wobbling, then the GFC only made things worse.

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"It was the usual thing with property cycles, they break under their own weight. It got really unaffordable and was a massive speculative bubble and it ran out of buyers.

"Then the GFC came along and exacerbated it. Banks really pulled back in terms of their new lending and we went through a credit drought period."

Analyst Rodney Dickens points to an inflation problem that had been brewing since the turn of the century.

SUPPLIED Shamubeel Eaqub says there could be another downturn like 2008's.

There had been 13 official cash rate increases in a row, which pushed New Zealand into a recession before the GFC.

Then there was a fall in migration, which took the demand pressure off the property market.

RECOVERY TIME

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An Auckland homeowner who bought a house in 2008 would have been back in positive territory two years later. Other parts of the country had longer to wait - and some are still waiting.

In April, house prices in Taumarunui were still 30 per cent below their 2008 peaks. Far North centres Kawakawa and Kaeo were down by a quarter, although are now catching up fast - with prices up 11 per cent year-on-year in October.

Data from Homes.co.nz shows even now Ruapehu District's median price is still down 11 per cent on 2007, Wairoa's is down 19.3 per cent on 2007 and Waitomo is down 20 per cent.

COULD IT HAPPEN AGAIN?

Eaqub says there could easily be a repeat of 2008, particularly in Auckland, where sales have dropped more than 20 per cent year on year.

He says sales volume changes usually precede price changes by three to six months.

Outside Auckland, there would need to be international factors to drive a downturn in prices.

"There is not the same over-valuation in the provinces," he says.

"But in 2008 they were overvalued too. The provinces had increased more in percentage terms than Auckland so it was not surprising they had that downturn."

Dickens agrees many of the affordability problems of 2008 are also in place in 2016. But he does not see a trigger that would drive a drop in prices.

He says, in terms of the amount of property for sale compared to the demand for it, there is still room for price growth.

That has slowed – where Auckland had previously looked to have demand consistent with 20 per cent increases, it now has 5 per cent.

Outside Auckland, the sales versus demand calculation had previously been consistent with 20 per cent price increases but could slow to about 11 per cent, he says.

"There is still enough demand versus the stock of property for sale to keep it at least average. We are a long way from parallels with 2008."

He says there have been no cases of national house prices falling in New Zealand outside of a recession and the economy still looks strong for now.