The town nestled under the Rock and Pillar Range and sited at one end of the Otago Central Rail Trail showed an 18% drop when three-yearly ratings valuations were released by the Dunedin City Council.
That compared with an overall 12.6% increase in capital value, and a 19.5% rise in land value for city residences as a whole.
Not everyone spoken to in Middlemarch yesterday thought an 18% drop was an accurate reflection of the reality in the town.
Dunedin city councillor Kate Wilson said there were houses where for sale signs had been hanging for longer periods, but they were ''not the most attractive houses''.
''The ones that are attractive have sold.''
Cr Wilson said the market was stronger than it was 15 years ago, and there was a holiday home market.
''I don't know why more people don't come up and use it as a base, because it's a really nice drive on a Friday afternoon, and not a really long drive.''
Cr Wilson said Middlemarch was a place ''of real potential'', particularly if values had gone down.
It was possible to commute to Dunedin, there were good prices and a good community.
The landscape was ''most amazing'', and the town was close to Rock and Pillar Range tracks, the Sutton Salt Lake, and the rail trail.
Strath Taieri Community Board member Norma Emerson said her feeling was Middlemarch's population had shrunk.
The 2013 census shows there were 153 people, 15 fewer than in the 2006 census, 72 occupied dwellings and 33 unoccupied dwellings.
Ms Emerson said there had been properties for sale for some time.
When she and husband Richard Emerson were looking for property there in 2010, they looked at one that was still for sale six years later.
While the 18% drop was probably a true general evaluation of the state of property values in the area, some people, such as the Emersons, had made extensive renovations to their properties.
That meant some houses would be worth far more than the rating valuation suggested.
She said she was surprised more people did not see Middlemarch as a potential home.
It was possible to drive to work on a good clear road in about an hour, or work from home via the internet.
The Emersons moved to the town ''just to live in the country, to have open space around''.
A short drive to the Sutton Salt Lake meant being ''in the middle of nature where you don't hear a sound and you don't see a person''.
Southern Wide Real Estate's Ray Kean said the market in Middlemarch had been more buoyant recently than it had been for some time.
''It's just like a lot of those smaller rural areas. There seems to be more and more activity in them as some of the other places get more expensive.
''People are looking to spread just a little bit further out.''
