Queenstown and Lakes District real estate agent David Penrose confirmed in a recent communique to clients that property investors are continuing to enjoy a buoyant Queenstown property market.
New Zealnd based property data consultancy Infometrics confirm this on their website noting that the average Queenstown and Lakes District home price increased 6.5% in the September 2024 quarter.
They note that the average house value in New Zealand fell 0.3%pa to $908,247 in the September 2024 quarter. Relief in mortgage rates has been seen from major banks with the 1-year fixed mortgage rate ticking down to 6.5%pa from 7.1%pa during the September quarter.
Further interest rate cuts from the Reserve Bank will push mortgage rates lower although reductions may be more modest as banks have cut mortgage rates heavily to compete for limited lending opportunities.
They believe that house price growth will continue to be constrained by the glut of listings on the market, with buyer numbers remained subdued due to job security concerns amid rising unemployment.
David Penrose said this when interviewed, “In contrast to the rest of NZ, Infometrics confirm that the average in Queenstown-Lakes District was up 11.1%, compared to a year earlier. The average current average house value was $1,847,277 in Queenstown-Lakes District in June 2024. This compares with the average value of $923,899 across New Zealand. Property sales in Queenstown during 2024 have been buoyant. This is due to many overseas investors seeing NZ and in particular Queenstown and lakes district as ‘a safe haven’ compared to the political uncertainty and wars that are unsettling many globally.”
high mortgage rates continue to be the driving factor of subdued demand outside the Queenstown district, as households struggle to earn enough to service a mortgage at such high recent rates. Minor relief in mortgage rates has been seen from major banks with the 1-year fixed mortgage rate ticking down to 7.1%pa from 7.2%pa.
Potential home buyers are waiting for further relief as the Reserve Bank cuts interest rates again sometime soon. Listing numbers continue to rise, however, with analysts believe buyer numbers are not going anywhere anytime soon. House price growth will likely continue to be constrained for the remainder of the year.
NZ’s cash rate was cut by 50 basis points (bps) to 4.75% on 9th October 2024. The next rate decision will be announced at 2pm on 27 November 2024.
There continues to be a steady number of purchasers looking to secure property in one of the most sought-after locations in New Zealand. The combined population for Queenstown and Wanaka is approximately 38,000 and this is predicted to double in the next 40 years. The present visitor numbers on a peak day are 80,000 and this is predicted to increase to 138,000 in the next 40 years. These forecasts are anticipated to continue to put upward pressure on Queenstown and Lakes District real estate prices for many years to come.
Further information on the Queenstown property market can be obtained by contacting David Penrose via his website here: https://www.davidpenrose.com
