A section boom in Clyde and Alexandra has left little room for the towns to expand.
Harcourts Cromwell and Alexandra manager John Petre said there were 42 section sales in Alexandra this calendar year.
''We're in desperate need of more residential sections.''
The Central Otago District Council may have to rezone land in its district plan review process, as ''nothing significant'' was coming to the table, he said.
''The cheapest way is to get a section and build. You can now see young people building new houses that are newly designed and warm, and not paying much more than an existing dwelling which is much older.''
The demand was partly due to the property booms of Queenstown, Wanaka and Cromwell ''flowing down'' to Alexandra, he said.
LJ Hooker Alexandra principal Elaine Schuck said section sales in Alexandra and Clyde ramped up in the past six months.
''People want to come here because it's still good value for money. But it might not be for much longer.''
Clyde was especially ''hot'' at the moment, she said.
The average section price in the towns was about $150,000, which was up 20% or 30% on a year ago, she said.
There were some left in The Pines subdivision, and ''one or two'' in Molyneux Estate, she said.
''There have been a lot of sales this year, but now there's definitely a shortage.''
The council is considering rezoning land on Muttontown Rd on the outskirts of Clyde as part of its district plan review, which will be publicly notified early next year.
In a survey of Clyde residents the council released in September, of which 251 responded, 54% said they did not want the town to expand compared with 39% who did.
The council also owns freehold land to the north of Alexandra which non-profit charitable trust Leaning Rock Village Inc has interest in using for a retirement village.
It needs this land and adjacent Crown land held in trust by the council for tree-planting purposes, which would create a total area of 25ha.
The trust plans to create 90 to 95 retirement units and an aged-care facility surrounded by 92 residential sections.
At a Vincent Community Board meeting in Alexandra yesterday, Leaning Rock trust chairman Russell Checketts said it hoped to attract mainly locals to the units, which would free up space in the town.
The board resolved to instigate the process of disposing of the Crown land so it would be ready for sale by Land Information New Zealand at about the same time.
Ngai Tahu has first refusal of this land once it is freed.
Mr Checketts said the iwi indicated it was interested in a joint venture.
