The Queenstown Property Market
The effects of slipping sales volumes and reduced capital value growth margins have become evident across New Zealand’s entire property market in recent months, and although Queenstown has been relatively less affected by this trend, it is not immune. While still experiencing higher growth than other areas of New Zealand, the recent figures have certainly fallen back to what is considered more sustainable levels with experts predicting a “levelling off” over the next few years.
Although with ongoing tourism growth in Queenstown showing no signs of letting up, massive infrastructure development projects and construction activity underway or in the pipeline and an ever expanding permanent population, it is difficult to see any lack of confidence in the Queenstown property market emerging any time soon.
The Effects Of The Queenstown Property Boom
Increased Average Values
Due to the increased demand and lack of supply investors and home buyers are faced with major difficulties when looking to enter the Queenstown property market. The average house price across Queenstown for July 2017 is $1,092,748, twenty percent higher than the same time last year – a figure that many find hard to contemplate, particularly outside of Auckland.
Schools, proximity to the town centre and other in-demand facilities increase desirability in central areas, with many resorting to residential subdivisions positioned further out of the core township in order to increase affordability.
As Queenstown continues to attract more tourists and both temporary and long term residents, its infrastructure is likely to continue to be strained. Queenstown appears to be continually attempting to catch up with itself.
It’s unprecedented construction and development activity has in turn provoked increased lifestyle demands, which has led to the need for more development on the commercial and infrastructure fronts.
Lack Of Accommodation
Rapid population growth has led to a lack of short term visitor accommodation and rentals in the Queenstown area. The supply and demand imbalance has also driven the need for longer term residential rentals, particularly for people attracted to the area for work reasons.
Intensive investment into motel/hotel style accommodation is underway along with many commercial retail additions, retirement villages and a new school.
Central and local government have placed public transport, town centre parking and arterial travelling routes as top priorities in order to ease the associated traffic congestion. This includes the new two-lane Kawarau Falls Bridge project and continued developments along the Eastern Access Road.
Queenstown Suburbs Of Interest
Restricted space, convenience and locality all contribute to Central Queenstown’s popularity, all real estate, whether residential or commercial, is understandably expensive in this desirable location. Rental properties are particularly difficult to come by with many existing properties packing in the numbers of tenants with additional sleepouts and extensions.
Home to Queenstown’s international airport, Frankton is seeing a huge investment in retail, accommodation and infrastructure. A new convention centre, hotels and retirement villages are all in the pipeline along with improvements in roading already nearing completion. Frankton’s median house price is $827,000 as at July 2017.
One of the older more established suburbs in Queenstown, Fernhill is nestled along the shores of Lake Wakatipu at the bottom of Ben Lomond Mountain. The median sales price for July 2017 in Fernhill is sitting at $903,000 (according to QV), placing it at the higher end of the Queenstown property market. Short term holiday rentals are particularly popular in Fernhill due to the sunny aspect and views over the Lake.
Consistently one of Queenstown’s most expensive suburbs, Kelvin Heights is situated just across the Kawarau River, very near Frankton. It’s not hard to understand why it consistently demands the high prices when faced with its prime lake front position, stunning views and easy access to the central township. The improved Kawarau Bridge project will only add to the desirability.
Lake Hayes Estate
The Lower Shotover, Hayes Creek and Lake Hayes Estate subdivisions have been immensely popular with home buyers and investors. Set on a relatively flat landscape only 15 minutes’ drive from central Queenstown the sections and properties are currently sitting around the $900,000 median sales price figure. Recent additions of a children’s playground, central park and retail developments have only added to its popularity.
With median house prices breaking the 1.2 million mark, Jacks Point has firmly cemented its position as one of the front runners in the high end property market in Queenstown. Strict design recommendations and covenants to protect the buyers investment have ensured the 1200 hectare settlement’s exclusivity and desirability.
According to QV sales figures for July 2017, only one property has sold in the Queenstown Hill area in the last three months. The sales price of $2,955,000 says it all really, Queenstown Hill offers buyers the ultimate in luxury properties with spectacular views over Queenstown Bay and Lake Wakatipu.
Queenstown Property Market Useful Links
- Quotable Value – For the latest Queenstown and New Zealand property stats.
- Queenstown New Zealand – Tourist and visitor information about the region and its activities.
- iSITE Visitor Information – The official Visitor Information Centre website for Queenstown. (Part of the nationwide Tourism New Zealand and Government approved i-SITE Network)
- NZ Government – Information on the requirements for the sale and purchase of property in New Zealand.
- Landlords – New Zealand rental property statistics and information.
- Stuff – For the latest news and property headlines, New Zealand wide.
Increasing construction costs, lending restrictions and the possibility of higher interest rates are all likely factors that will have an impact on the property market in Queenstown, however while demand outweighs supply in the residential sector there is no reason to believe property owners will not continue to see good returns in the near future.