The Otago real estate market has hit hard times, with houses sitting on the market for months, and many properties overpriced.
Statistics from the Real Estate Institute of New Zealand (REINZ) released yesterday showed in the Dunedin area, the median price had dropped from $260,000 in December to $250,000 in January.
There were 181 houses sold in Dunedin, compared with 208 in December, and 198 in January last year. In the Central Otago-Lakes area, the median price increased from $419,000 in December to $476,500 last month.
There were 118 houses sold in January, compared with 124 in December, and 155 sold in January last year. REINZ Otago president Liz Nidd said the most telling statistic was the number of days a property was taking to sell.
In January 2007, in Dunedin, it took, on average, 39 days to sell a property, but last month it took 52 days to sell a house.
She said this was the highest selling day length in January for more than 10 years. Mrs Nidd said the threeyearly valuations by Dunedin City Council released in November last year had led to false impressions for many property owners.
‘‘That gave an expectation of what a property is worth, but the valuation is strictly for rating purposes. It has nothing to do with the market,'' Mrs Nidd said.
She said there were properties listed - with a price set based on the rating valuation - which were $100,000 away from what the market would pay, She said the market was on the brink of a price correction.
It was very much a buyer's market and it was almost unheard of for a buyer to purchase a property unconditionally. Many sellers were dropping their price.
There was little impulsive buying, and mortgagee sales were to be expected, she said.
However, most Dunedin buyers were more astute and did not extend themselves as much as northern buyers.
REINZ Queenstown spokesman Adrian Snow said the median price in the area had held up well. There had been 50 sales in January in Queenstown, compared with 54 in December, and 82 in January last year.
It had taken, on average, 119 days to sell a house, in Queenstown, up from 42 days in the corresponding month last year, but he said that figure had been heightened by a couple of sales.
In January, 10 properties valused at more than $1 million each had sold in Queenstown. The market for houses between $750,000 and $1 million was the toughest, he said.
