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Data released yesterday by property website realestate.co.nz shows asking prices in Central Otago and the Queenstown Lakes area bolted by 41.9% in the 12 months to October 2021 to reach an average of $1,423,038.
That is well ahead of the national average asking price
last month of $993,135.
The increase in Central Otago was a "classic supply and demand situation", Harcourts Cromwell sales manager Peter Bennetts said.
In Cromwell there was a lack property on the market and very few titled sections available to build houses on.
There were some sections available at the Wooing Tree development but the titles would not be available until the middle of next year and into 2023.
There was also plenty of demand, good numbers turning up at open homes and a strong level of inquiry from around the country, Mr Bennetts said.
"It is a case of just not having the stock available to service that demand," he said.
There was also concern about the supply of building materials for the construction sector and the impact the global shipping delay was having on that.
He believed the current conditions made it a good time to sell property, Mr Bennetts said.
For the rest of Otago, including Dunedin, and Southland, asking prices were up about 20% for the 12 months to October.
Otago’s average price was $625,816 and homes in Southland were starting at an average of $475,198.
Dunedin Edinburgh Realty consultant Jim Columb said the increase in the city’s market was also a supply and demand situation.
There was a lot of demand and not enough stock to service it.
The Government’s restrictions on selling investment properties had put further pressure on the market, he said.
"People that may have sold their investment property are now getting taxed, so it has tightened the stock up even further."
It was not just one particular type of buyer showing interest in the Dunedin market, it was everyone from first-home buyers to the top end of the market, he said.
"The market has not just moved in a certain sector, it has moved right across the whole board," he said.