The latest QV house price index, released yesterday, showed the average home value in Queenstown increased by 2.9% to $1.7 million, while the tourist town was still showing positive growth of 4.9% for this year — a stark contrast to an average national decline of 9.7%.
QV property consultant Greg Simpson said this year’s ski season was one of the best on record.
Destination Queenstown data showed visitors stayed longer and their expenditure increased compared to pre-Covid-19 levels, while the rest of the district appeared to be operating at near-normal activity levels.
However, property market conditions were subject to high potential for change and market uncertainty, and there was currently reduced sales volumes and tapering — but still positive value growth for residential property.
"With inflation now becoming more entrenched, further interest rate rises are expected from the major lenders, which will continue to have a cooling effect on the housing market," Mr Simpson said.
The list of towns, cities and regions hitting double-digit home value declines this year was growing, with Wellington (-17.5%) topping a list of main centres that now also included Auckland (-11.7%), Hamilton (-10.5%), Napier (-11.6%), Hastings (-11.5%), Palmerston North (-13.7%) and Dunedin (-10.4%).
Dunedin’s average home value experienced a marginal increase of 0.6% in October to $650,227, breaking a nine-month consecutive streak of declining values.
However, values remained 1.5% lower this quarter and 10.4% lower than at the start of the year.
QV registered valuer Rebecca Johnston said while the city’s upturn in property values in recent years did not see the same level of significant growth that Wellington and Auckland experienced, the downturn meant there would be less buyers from late last year in negative equity compared with those larger centres.
Market rents remained strong while there continued to be a shortage of rental properties — with housing continuing to remain unaffordable, rental returns were expected to remain strong.
In Invercargill, the average home value experienced its sixth drop within the last seven months; its average residential property value was now $473,376, dropping from a peak in March of $498,473.
That figure was still 0.6% higher than the same time last year but had dropped 2.8% this year, including by 1.8% this quarter.
There was much less demand now compared to late last year and early this year, and that was particularly evident for entry-level housing, local valuer Andrew Ronald said.
Mackenzie, at 6.5%, headed a shrinking list of 21 districts that still had net-positive home value growth to show for the first nine months of the year.
