Small towns in the South Island, with some of the tiniest house prices, and suburbs in the most expensive holiday town are defying the country’s property slump because buyers feel they are better value than some larger and more central locations.
The list of 10 New Zealand suburbs that have seen the biggest increases in property values in the last 12 months comprises the West Coast towns of Reefton, Hokitika, Karoro, Runanga, Greymouth and Ruatapu; Albert Town and Lake Hawea in Queenstown-Lakes; Loburn in Waimakariri; and Mount Pisa in Central Otago.
It’s a stark contrast to suburbs in the country’s major cities where only two of the 59 suburbs have seen house values rise in the last year – and even then, the increases have been slight.
Valocity senior research analyst Wayne Shum said the urban centres are still not seeing any year-on-year growth and it is this market that drives the New Zealand Value Indexes.
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The suburbs that have seen growth are mostly in lower values areas, he said, and holiday locations such as Queenstown and several towns in Northland and the Coromandel where the demand is still driving prices up.
“They still have a lot of demand and not a lot of supply. You look at a lot of these locations and it’s not where big developments have been happening.”
Most of these suburbs appear to have been immune to any price drops and also saw values rise between 2021 and 2022.
“These are the suburbs that have sustained a national drop quite well.”
The West Coast’s suburbs that have recorded the four biggest increases are Reefton up a whopping 17% to $358,000, Hokitika up 9.8% to $435,000, Karoro up 9.5% to $541,000, and Runanga in Grey District up 9.2% to $250,000.
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Greg Daly Real Estate salesperson Deedee Daly said the West Coast hasn’t experienced a dip like a lot of other areas and the market remains consistent.
A lot of buyers are moving from places such as Motueka and the East Coast to the West Coast because it still represents better value, she said.
Most buyers are owner-occupiers, she added, but some investors are also slowly returning to the market.
West Coast prices range from the early $200,000s up to the $600,000s depending on the property and location.
Reefton saw the biggest year-on-year jump, and Daly said prices have increased significantly in Reefton in the last 10 years.
However, it is still an extremely affordable option for many with the agency recently selling as entry-level four-bedroom, two-bathroom do-up on Shiel Street in Reefton for $270,000.
“With Reefton the prices are increasing and that was a real bargain for the person that bought that.”
Hokitika on the West Coast still represents affordable buying with a four-bedroom, two-bathroom home on Park Street recently selling for $380,000. Photo / Supplied
A house, sleepout and a successful business can be purchased on McGowan Street, in Runanga, West Coast, for $660,000. Photo / Supplied
While a four-bedroom, two-bathroom home on Park Street in Hokitika recently sold for $380,000 in the area that has recorded the second biggest year-on-year growth.
Daly said Runanga, which has among the country’s lowest average property value at $250,000, is deemed to be a bit cheaper than some of the other areas.
“... but in saying that the prices there are still growing, and we do have an offer on one in the $500,000s in Runanga. The market has stayed quite stable here.”
Meanwhile, there is still interest in what is considered more expensive properties for the West Coast with a five-bedroom, three-bathroom lifestyle property at 179 Colson Road in Paroa priced in the $900,000s and currently under contract.
While a three-bedroom, two-bathroom home at 14 Stanton Crescent in Karoro with sea views has an asking price of $629,000.
“For us that’s probably high-end prices,” Daly said.
Queenstown-Lakes has also seen property prices in some of its suburbs continue to rise in the last year with Albert Town rising 8.3% to $1.554 million, Lake Hawea up 5.9% to $1.298m, Lake Hayes up 5.9% to $2.648m and Arthur Point up 3.7% to $1.581m.
New Zealand Sotheby’s International Realty managing director Mark Harris said Queenstown-Lakes’ house prices dropped between 2021 and 2022 albeit less than the national average.
However, he believes Albert Town and Lake Hawea may have bucked the trend because they are up-and-coming areas.
Lake Hayes is seen as being more affordable than some other suburbs in the area. A four-bedroom, two-bathroom home at 17 Sandford Terrace is for sale for $1.375m. Photo / Supplied
A high-end home on Mahoenui Valley Road, in Coatesville, Auckland is seeking buying enquiry from $9m. Photo / Supplied
A new two-bedroom townhouse at 27D/20 Alison Ave in Albert Town is for sale for $712,000, while a new four-bedroom, two-bathroom home at 22 Rua Street in Albert Town has an asking price of $1.35m. In Lake Hayes, a four-bedroom, two-bathroom home at 17 Sandford Terrace can also be picked up for $1.375m.
“I imagine it’s driven probably by the prices being high in central Queenstown and Wanaka, and so therefore first-home buyers or new homeowners looking for outlying areas that are probably less expensive and it’s driving popularity in those areas, and it’s driving prices up.”
Harris is not surprised by the more expensive Lake Hayes also sustaining growth due to being north-facing and its position on the lake.
Russell in Northland is the North Island town to see the biggest year-on-year growth up 4.4% to $1.612m.
While Coatesville in Auckland and Avondale in Christchurch just snuck in with a slight value increase of .2% and .9% respectively.
Precision Real Estate agent Nicky White said Coatesville’s popularity continues to grow and this is helped by the good schooling, proximity to beaches and improved accessibility.
“The fact that it has been able to be subdividable down to 1ha lots has meant it has had a huge growth phase because of that.”
It is also one of Auckland’s more expensive suburbs and has an average property value of $3.714m.
White said land starts from $1.2m and a new home could be anywhere from $2.5m up to $12m. Sections on Mcgiven Place are currently for sale in the early $1ms, while a near-new luxury home at 232 Mahoenui Valley Road in Coatesville is seeking buyer enquiry of $9 million-plus.
- Click here to find more properties for sale on the West Coast
