Queenstown – What’s Happening
“Busy busy” has been the call around Queenstown for the last two weeks as New Zealanders headed south for skiing over their school holidays. The ski fields have been reporting large numbers on the fields and I suspect there may have been a few near record days. Air New Zealand has been reporting more passengers for the two-week holiday period than last year. Queenstown’s ultimate economic barometer – the Fergburger queue was showing “hot” with the return of a sizeable line down the foot path. The locals were even pleased, if not somewhat bemused, to find themselves dealing with otherwise unexpected traffic congestion. Thank you New Zealand and we look forward to seeing you next holidays.
The sales statistics recorded for June 2020 reveal a relatively normal month of activity. 45 dwelling sales for June 2020 compares directly with 44 sales for June 2019. Ignore 2019’s section sales, this was the release of titles for Hanley’s Farm and represents about 18 months of sales activity.
The June 2020 mean sale price for dwellings at $940,000 compared to $1,030,000 for June 2019 suggests a potential 10% reduction. The median 12 month high was March 2020 at $1,055,000 and the low in October 2019 was $915,000 so June’s median is within the range of high and low points for the last 12 months.
Higher value homes have featured in June’s sales, indicating a recuperating market for the higher value properties:
Anecdotally, salespeople are reporting good activity and enquiry, a significant shortage of stock, and an increase in contracts failing as lenders decline an unexpected number of lending applications.
The first six months of 2020 has yielded a telling statistic; the first 6 months of 2020 has generated an incredibly low 198 residential sales which is 56% lower than the first six months of 2019 at 457, whereas nationally this year is only 17% down at the same time last year. Queenstown has clearly had a slower post-Covid recovery than the rest of the country and the effect of low numbers of properties for sale is clearly inhibiting sales.
www.realestate.co.nz supply our listing data. They report for the region of Central Otago-Lakes District (Wanaka and Queenstown) for the month of June 2020:
The 12 month low was August 2019 at 562. 732 for May 2019 is the 12 month high.
In summary, we now have a reasonable data set as we move away from the cessation of activities during Alert 3 and 4 lockdowns. June 2020 was very comparable to June 2019, although this is seasonally the quietest month of the year. Listings to market remain light, stock levels remain low and we are seeing a decrease in sales value with the dip in the median price over the last three months, but keep in mind that this dip was off the back of three months of record median prices.
The Queenstown market is healthy and we can reasonably expect it to perform as the rest of New Zealand currently is.
Kingston – Glenorchy – Arrowtown
Kingston has slowed a little from its high performing month last month, recording one dwelling and one residential section sale. Enquiry on homes remains strong and is quiet on sections which is to be expected at this time of year. Six homes are currently for sale and a good selection of residential sections remain available at Lakefield Estate. Contact Mescha to learn more.
One home in the township is recorded as being sold for June 2020. With only two lifestyle homes currently for sale and no residential homes currently on the market, Glenorchy is leading the region on low supply levels.
Please call Stephanie for the latest information.
Five sales were recorded for Arrowtown, two of which where Millbrook. Sale prices ranging from $975,000 to $3,200,000 in Millbrook. Excluding Millbrook and rural lifestyle homes, I count seventeen residential homes currently for sale. These are high stock levels for Arrowtown and the market has probably moved to a buyers market.
Source Real Estate Institute of New Zealand Market Report June 2020 [See REINZ Report]
Westpac’s Weekly Economic Commentary for May 2020 is headed up “No shelter for the Smelter”:
“The removal of COVID-19 restrictions on domestic activity has continued to give the New Zealand economy a boost. The manufacturing sector is now joining in, with the PMI manufacturing index rising strongly a two-year high in June. However, as recent news demonstrates, the pandemic has brought to a head some long-running pressures within heavy manufacturing in particular.” [See Westpac Report]
A new form of stablility has settled in to the residential tenancy market. The initial shock of changed employment conditions, job losses and needs to relocate have passed through. Our peak workload is reducing but still above normal. We are preparing for another spike in workload and tenancy issues as we near August and the end of the wage subsidies when we expect more redunandancies.
Queenstown’s busy school holiday period delivered plenty of business for our Holiday Homes. Occupancies were very close to last July, but tariffs reduced to meet the new market conditions. Our managers were pleased to be busy as were our housekeeping contractors and our guests all seemed to have had great holidays. Occupancies now have tapered off and our forward bookings not quite as strong as we would like, but we have just learned that Kiwi’s are holding and booking closer to their holidays as they wait to see if borders to Australia and the Islands open. We have every expectation that our coming holiday periods will be busy, but for now we get to experience the old fashioned tourism that cycles around New Zealand school holidays.
From our team to you, thank you for your support and your trust, we look forward to talking with you soon.
Principal Agent and Director AREINZ MNZIS
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