Market up but will it last?


Queenstown property stats show a six-month pattern of rising confidence and activity, says a real estate spokesman.

The Real Estate Institute of New Zealand’s latest Wakatipu sales report shows 45 residential dwellings sold last month – down from 64 in April but one higher than in March.

The drop from April was expected because May/June are quiet for real estate as well as tourism, says local REINZ spokesman Adrian Snow.

May’s figure was still 18 per cent ahead of the same month last year.

Section sales in May also increased from only three last year to nine last month – just down from 11 in April – and there were five property sales of more than $1 million.

Snow: “What we’ve been saying ever since the beginning of this year, as real estate agents, is that interest has been very gradually but consistently improving – it’s probably taken until now for the sales figures to start showing that.”

Local figures are also consistent with the nationwide trend – last month there were 6291 homes sold in NZ compared with 4372 in May last year.

But like the rest of the country, listing levels in the Wakatipu were also low, Snow says.

“Vendors are electing to wait until they see a recovery in prices.”

Snow, who says local prices have come back about 15 per cent since peaking in 2007, agrees low supply should drive them up.

“Theoretically, if we weren’t in a recession you’d say, yes, the prices have to go up – but it’s very hard to tell.”

Buyers are still driving a hard bargain.

Ironically, the apartment market – where prices have dropped most – was showing the least activity.

Only six apartments sold last month, compared with 10 in May last year and 18 this April, yet the median sale price is $400,000 compared with $607,250 a year ago.

Apartments last month were taking 196 days to sell compared with 92 days in May last year.

Early this month a Westpac bank economist warned sales volumes and prices would slacken in the second half of this year due to rising unemployment and higher long-term mortgage rates – lower interest rates have been a major factor behind the recent resurgent market.

Snow, however, is hesitant about predictions: “Just about every other expert I see making forecasts tends to get it wrong.”

Airport sites ideal for planespotters

Three land parcels near Queenstown Airport with a total capital value of more than $4 million are being auctioned on July 16.

The two most valuable plots are on Lucas Place by the road to Remarkables Park Shopping Centre and are both owed by a company linked to local businessman Phil Dunstan.

Dunstan once housed his Lakes Contract Services work depot there – that land is now leased by Delta Utility Services, which bought LCS, but it’s relocating to Jack’s Point.

Locations Realty’s Steve Kirk says the two parcels are subject to a boundary adjustment – together they comprise 5049sq m with a capital valuation of $3,755,000.

Zoned “Queenstown Airport mixed-use”, the land suits a rental car or coach company or mechanic-type operation, Kirk says.

The third parcel is 50 Douglas Street, owned by the same Dunstan company – the 1523sq m vacant plot, zoned residential, used to be a through-road from Lucas Place.

“There’s not much else around the airport you can buy like this,” Kirk says.