When the statisticians report on the full calendar year-2013 covering Queenstown’s property market it’s my view the gains made comparing 2012 will be modest and in the order of +2.5% for the volume of sales and +5% for the aggregated value of sales.
For 2014, more of the same, perhaps a milder ride as affordable homes new to the market could be scarce as the supply side catches up on the inventory recently sold.
Supply and demand will play out for 3-4 bedroom standalone kiwi homes (notably in the $525k-$650K price band) and we should expect median price gains for existing dwellings. This will restore equity to many local home owners which may entice some to trade up.
Homeowners who get too aggressive on price could be left in the dust. Buyers remain price conscious and investors recognise when the value proposition is out of kilter. Expect home buyers and investors to square off as they compete to see who gets to turn the key in the door.
Affordability will remain an issue as income levels don’t keep pace with increasing house prices. Queenstown rental letting companies are sure to have another stellar year as start-up businesses new to the resort create employment not forgetting a growing base population as reported in the latest census data.
There’s nothing like that new-home smell and with good sections sales throughout 2013 another building-block year is ahead. With existing home prices on the rise, there will be a gravitational pull toward the new-home market in the likes of Shotover Country Estate and Jack’s Point. Spec builders at Jack’s Point wanting to achieve prices in the range $900K-$1.2m should expect competition as they endeavour to garner favour with buyers luxuriating in choice. The smart money will be on new homes sub-$800K at Jack’s Point if in fact new homes at these prices can be delivered with increasing construction costs.
Keep an eye on the horizon as mortgage rates will rise from historic lows and the money lenders getting creative about how to put buyers into home loans.
Recent investment in Hotel development land by Chinese investors will ensure Queenstown registers as a new blip on their radar as an emerging lifestyle and investment property destination.
The good thing about the future is it comes one day at time; so make opportunities rather than wait for them to come along.
“The future depends on what you do today.” ― Mahatma Gandhi