Dampened? It's not dampened demand in the Otago property market, according to the latest report from local experts Harcourts.
They say areas like Cromwell and Wanaka are bucking the national trend of "dampened demand", where sales activity is down and days to sell are markedly increased.
Harcourts Otago's Market Report analyses sales and other statistics from the area for the six months ended June 2022, concluding that the area's not seeing the housing bubble burst some media commentators would have you believe.
"In Otago, the median price trend has increased strongly over a long period of time and, while it's showing signs of tapering of, we have to remember that in many cases properties are still selling above CV or asking price and auctions continue to surprise us with multi-bids and offers," says Harcourt's Managing Director, Warwick Osborne
"If buyers have negotiated their finance and are in a position to commit to their first home, holiday home or investment, Queenstown, Wanaka, Cromwell and the wider Otago district still have long-term appeal.
"There are multiple factors at play in the current market – including the willingness of many people to move to a stunning part of the world to work and play, because they can," he says. "The revolution that is working from home received a huge boost thanks to the pandemic and people have come to realise that they can live amongst the mountains and lakes, with great air connectivity to the rest of New Zealand and the world.
"We're still seeing many buyers across region coming into this market from our bigger cities and towns because they're exchanging the grind of a daily commute for working from home with the chance to take the occasional powder day when the snow's good."
Market steadiness in Dunedin, Queenstown, Alexandra and Balclutha is being bolstered by these trend-defying increases in Wanaka and Cromwell although, in all areas, the number of days needed to sell a property has typically increased.
"While some buyers may still be hesitant, and winter months are traditionally quieter, there have still been some standout sales in our offices over the past six months, including multi-offers and bidders on Queenstown properties as business confidence grows and tourism returns," the report says.
"In Cromwell, listing inquiries coming from Auckland, Christchurch and Southland show no sign of abating; Wanaka continues to go from strength to strength with new infrastructure projects, community and recreation centres, new subdivision titles being released and special sections launching to market."
Dunedin's balanced market continues to reward prudent buyers and sellers as strong commercial activity continues with the hospital build and university expansion, among others. Demand for lifestyle blocks and larger residential sections is still strong in Alexandra, and commercial activity is booming, it says.
"With more stock on the market, more opportunity for negotiation, and prices off their peak, there's opportunity here for those with access to finance."
The six key areas of the Otago market are:
Alexandra
•Average sale price is eight per cent higher than the same time last year
•Median sales values: $637,500. Median section value: $277,500
•Average sale time up from 28 to 40 days
•Both median prices are steady, about the same as Harcourt's market report from July-December 2021.
•Comment: "The Alexandra market remains steady with a more balanced market than we have seen for some time."
Balclutha
•Median sales values $427,500 – down from $459,000 six months earlier
•Median section value $140,000.
•Comment: "The Balclutha market has defied the trend in much of the country, remaining quite steady on median value."
Cromwell
•Median sales value $850,000, up 2.78 per cent compared to July-December 2021
•Median section value $403,000
•Slowdown in total sales, from 110 in the second half of 2021 compared to 82 in the first six months of this year.
•Number of days to sell: 38 days compared to 16 days in December last year
•Comment: "Cromwell's popularity has surged in recent years, offering better value for money, close proximity to the other centres and its own attractions to boot" and "over half of all listing inquiries are coming from Auckland, Christchurch and Southland, showing that Cromwell's still highly desirable for people looking to relocate."
Dunedin
•Median sales price moved from $670,000 in January to a low of $631,000 in April, before bouncing back to a median in June of $645,000.
•Median section price: $410,000
•Days to sell: average of 42, up from 23 last year
•Comment: "Dunedin continues to offer relatively good value for buyers in every price range across the market" and "the low median value in April is very much reflective of the market shock as media reported a range of 'doom and gloom' scenarios. The bounce back in median value is indicative of continued confidence in the Dunedin market."
Queenstown
•Median value $1.35m; media section value $359,000
•Queenstown dwelling sale prices have experienced a slight softening in autumn 2022, compared to summer 2021-22.
•However, the median dwelling sale price in June of $1.25m is still well up on June 2021 of $1.125m as at June 2021.
•Median days on the market: 44 days up to 57.5 when comparing June year on year.
•Comment: "Commercially, Queenstown is brimming with confidence. Business confidence is growing and tourism is making a sharp recovery."
•Comment: "The ship may have sailed for opportunists looking for a 'bargain' in Queenstown…We don't believe large capital gains will be realised in the immediate future as they have in the past three years. However history has taught us there's never a wrong time to invest in Queenstown when purchasing with a long-term outlook.
Wanaka
•Median value: $1.35m (same as Queenstown)
•Median section value: $662,000
•May saw a record medium dwelling price of $1.92m over 44 sales, and a median section price reaching $872,500 over 10 sales.
•Comment: "While there's talk of the market slowing around the country, Wanaka shows little signs of it" and "There's no denying that this part of the country is extremely desirable and Lake Hawea is arguably one of the fastest-growing areas in the district - destined to become a major part of Queenstown Lakes' growth over the next five years."
For more information, see Harcourt's Otago Market Report here.