House prices pushing Dunedinites north to Canterbury

The Faringdon subdivision in Rolleston. Photo: Selywn District Council
The Faringdon subdivision in Rolleston. Photo: Selywn District Council
Increasing numbers of frustrated Otago home hunters are heading to Canterbury, lured by newer and more affordable homes, local brokers say.

Dunedin continues to hit records on almost a monthly basis, with growth over the past quarter at 4.9% and annual increases in house values at 18.1%, well ahead of all other main centres, according to Quotable Value (QV) numbers for February.

QV Property consultant Tim Gibson said the average house price in Dunedin was now $530,262, up more than $3000 from just a month ago.

There is no discernible difference in pricing depending on suburbs, with sale prices ranging from $545,379 for the central and northern part of the city to an average price of $493,681 for properties in coastal and peninsula areas — the latter increasing more than 21% on early 2019.

By contrast, average prices across Christchurch had advanced by a more sedate 3.5% to $512,442, following a post earthquake lull, peaking at an average of $710,817 in the Port Hills and a more affordable $460,525 in the Waimakariri District.

CoreLogic head of research Nick Goodall said Dunedin prices had jumped ahead of Christchurch’s for the first time in November 2019, driven largely by demand and a lack of available stock.

LJ Hooker Dunedin licensee and auctioneer Jason Hynes said he had noticed an increasing number of ‘‘mostly older’’ buyers who had decided to relocate for financial reasons.

Helensburgh resident Kath Cole and her husband had been looking to downsize from their large home for the past year and were now ‘‘likely’’ to shift to Christchurch.

‘‘Prices are just unrealistic here. There is a big cross-section of quality, so we think we can get the same-size home in Christchurch for substantially less,’’ she said.

QV senior consultant Kris Rogers said the Christchurch market had a ‘‘relatively positive’’ start to 2020, with first-home buyers leading the charge.

One first-home buyer from Dunedin said he had opted to buy in a new development in Lincoln, outside Christchurch.

‘‘That was after about a year and a-half of heading to open homes and auctions and finding nothing suitable.’’

He said he and his wife had also qualified for the Government’s $10,000 first home grant as a result.

Dunedin brokers say the house price cap under which first-home buyers can qualify for a $5000 grant, was an issue for Dunedin buyers, which were still operating under a $400,000 cap.

First-home buyers in other urban centres like Christchurch and the Selwyn district qualify if they squeak under $500,000 while Auckland and Queenstown Lakes are higher still, at $600,000.

Bayleys Metro Dunedin sales manager Adam Gain said the additional funding was important for first-home buyers who were accessing their KiwiSaver for deposits.

‘‘There are only a handful of properties available at this level in this market,’’ he said.

Mr Hynes said he thought it would not be too long before Dunedin’s limit was increased, considering it is now ‘‘very difficult’’ to secure a property within these parameters.

Comments

What is Dunedin City Council going to do about this? Or, will they celebrate as those that move north will most likely take a motor vehicle with them? The DCC needs to act now and make more land available - not just small pockets of land that will result in expensive sections but sufficient land to meet demand. I appreciate it's the land owner that sets the price but it's because there is little supply available - c$300k for a 600sqm section in Mosgiel - come on!
Dunedin, as beautiful as it is, really has nothing going for it. Christchurch on the other hand...

Then, DCC will be criticised for intervening in the Market.

Yes, but it;s so flat there are barely any views. Winter, much colder than here and fogs we don't see here. Takes a month to get across town compared to 15 minutes here. You think we have road rage in Dunedin? Crime....well, enough said really. Architectural diversity and charm, can't go past Dunedin. And yes SH_888, we certainly have the natural beauty, not to mention the wildlife. One hour and we're in the heart of the Catlins, two hours and we're on the Southern most coast, an hour and we're in the middle of the most stunning place in NZ, Central Otago, Ida Valley, Ophir, Middlemarch. Five or ten minutes and we can have the choice of multiple beaches. A short drive or three hour cycle ride over the Peninsula, views to die for. A wander down the main street, the atmosphere is full of charm and activity. But hey, Christchurch like you say, has so much going for it....so yes, I can see the temptation to move to Christchurch. The reason Dunedin is becoming expensive? New Zealanders and those from overseas have awoken to the stunning lifestyle here. It does come at a price, for first home buyers, I woud hope the cap could be raised, their families would benefit growing up here.

That is very good new's to read it mean's that the value of our home's will continue to rise.

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