Changing Queenstown property market dynamics revealed in Colliers’ annual report
Friday 14 Jun 2019
Following an unusually prolonged period of growth, the Queenstown property market appears to be taking a breather – although there are many signs pointing to several areas of the market remaining at elevated levels for some time to come.
This trend, among other current dynamics in the resort town’s property market, are discussed in Colliers International’s 2019-2020 Otago Market Review and Outlook, released today (June 14).
The apparent changes in the market mean this year’s annual review was one of the more challenging the Colliers International team has researched and produced in at least the past five years, says valuation director John Scobie.
“We had many in-depth and interesting discussions with our valuation and agency teams and external experts about the current state of the market and its expected future direction while we were putting this year’s report together,” Scobie says.
“Whereas for much of the past five years or so there’s been no question about the staying power of the property market peak, this year we had some highly engaging and robust debate around the clear evidence that some parts of the market, such as residential property, are showing signs of levelling off.”
Commercial, retail, industrial and tourism-related property remain strong performers, especially town centre retail & commercial and Frankton industrial. Factors including expected population growth, ongoing construction activity and tourism are continuing to underpin property values and rents in these sectors.
Meanwhile, in the residential market the balance of power is expected to shift to purchasers in 2019-2020, with value appreciation tapering off and a period of consolidation likely.
“It’s important to note that while there has been a change in residential market dynamics, overall the Queenstown property market remains steady,” says Scobie.
“There is still plenty of demand in the market driven by tourism, the area’s growing population and the ongoing construction boom – but we are now expecting any further growth to occur at a more moderate pace than we’ve seen in recent years.”