Queenstown Property News for March 2014 – More Fluctuations

Date: 9th May 2014 by Tim Medland

Highly noticeable growth in tourism this year is already fueling renewed interest shown by small to medium investors for tourism accommodation in Queenstown. According to the latest Queenstown RTO (Regional Tourism Operation) report “Total visits by travelers to Queenstown are forecast to rise from 1.887 million in 2009 to 2.129 million in 2016. An increase of 12.8% (242,000) or 1.7% p.a.”
What does this mean for residential sales in Queenstown? It can be argued that housing sales locally are still going through fluctuations that are not always confirming the general trend – as was the case in March 14. However, values have reached a new record high nationally, “driven by renewed seller confidence in the major centers” according to the realestate.co.nz March report. Queenstown is no different, despite the number of residential sales being more subdued in March.
So now to the numbers: Residential housing sales took a backseat in March with 42 compared to March 2013 that saw 58 sales. Surprisingly we are also below the 5 year average of 47 and the 10 year average of 50.
Despite the above we have seen values stay strong with the median sale price much higher than a year ago, at $663,500. Bear in mind this is also reflecting the ongoing effects of the new LVR rules, that is expected to keep some of the entry level buyers on the sideline for a while.
The average length of time required to sell a house is also up in March 2014, with 52 days required to sell, as opposed to 43 days in March 2013. Remember also that March saw the first increase in the OCR after a very long period at 2.5%. This may have put some buyers on a holding pattern, whilst assessing effects on mortgage rates and seeking out the best deals offered by mortgage providers.
Once again the total value of sales since the start of this year confirms a higher value in sales in general, with $112.2m compared to 97.9 million for the same period last year, this is despite ducking under the number of sales for the past six months, at 298 sales compared to 326 sales for the same period last year.
Indeed on the basis that supply and demand conditions are still tipping in favour of buyers we could see the number of sales rebounding in April. So watch that space when the numbers come out.

Posted in: Statistics