Otago Property Market Update.

This article breaks down all the most essential facts about the Otago property market.

The Otago property market is made up of 5 districts and 65 suburbs. These districts are Dunedin City, Central Otago, Queenstown-Lakes, Clutha and Waitaki.

As at October 2021, the median house price in Otago is $760,000. This is up from $255,000 10 years earlier. That means that the median Otago property increased in value by $50,500 on average.

The most expensive suburb in Otago is Kelvin Heights, which has a median house price of $2,027, 550 and is located in Queenstown-Lakes district. That means that Kelvin Height's median house price is 2.18x Otago's median.

The least expensive suburb in Otago is Lawrence, which has a median house price of $302,650 and is located in Clutha district. That means that Lawrence's median house price is 52.53% cheaper than Otago's median.

Over the last 21 years (Jan 2000 – Jun 2021), Otematata had the fastest-growing house prices in all of Otago, at 11.18% per year. That is 33.88% faster than the median Otago house price.

The suburb that grew the slowest over that period was Balclutha, which grew at a rate of 6.92% per year. That’s 17.11% slower than the median Otago house price.

On average, over the last 28 years, Otago's median house price has been 73.19% of New Zealand’s median house price.

Assuming the long term fundamentals of either property market have not changed, Otago's median house price should trackback to this long term average.

That suggests that when Otago's median house price is below its long term average, there is a buying opportunity. When Otago's median house price is above its long term average, there are buying opportunities in other regions.

As of October 2021, Otago's median house price was 84.15% of New Zealand’s median house price. That is 10.96% above its long term ratio, which suggests there is likely buying opportunities outside of the Otago region.

This map shows a breakdown of how over or under-valued each council area is right now in the Waikato property market. These figures are calculated exactly the same way as the graph in the above section.

Dunedin City appears to be the most over-valued. House prices there are about 7.24% above where we would usually expect them to be over the long term.

Waitaki district, on the other hand, appears to be slightly under-valued. House prices in this district appear to be 2.57% below where we would expect them to be.

This means that we've got greater confidence that Waitaki would receive a higher rate of capital growth (house price increases) over the next 5-10 years compared to Dunedin City.

The map below depicts which districts within the Otago Region have the most and least affordable house prices (Core Logic, July 2021).

The darker the district, the more expensive the average house price for that area...

The Queenstown-Lakes district is by far the most expensive district within the Waikato region, with properties reaching an average price of $1,344,802 (July 2021).

By comparison, the Clutha District is the most affordable, with an average house price of just $367,333. That's an enormous $977,469 difference compared to Queenstown-Lakes.

The map below illustrates the projected population growth for each district within the Otago Region over the next 25 years (2018 - 2043).

The darker the district, the more the population is predicted to expand in that area...

Over this period, the Queenstown-Lakes district is expected to see the most growth of all the council areas within the region – 49.87% in total.

By contrast, the Clutha district is expected to shrink by 6.25% over the same timeframe.

Dunedin City is made up of 35 suburbs. The most expensive suburb is Maori Hill, which has a median house price of $1,024,500. While the most affordable suburb is South Dunedin, which has a median house price of $445,800.

Over the last 21 years of all Dunedin City suburbs (Jan 2000 – Sep 2021), Calton Hill had the fastest-growing house prices, at 9.77% per year. That is 15.52% faster than the median Otago house price.

The suburb that grew the slowest over that period was Maori Hill, which grew at a rate of 7.54% per year. That’s 10.82% slower than the median Otago house price.

Queenstown-Lakes is made up of 15 suburbs. The most expensive suburb is Kelvin Heights, which has a median house price of $2,238,900. While the most affordable suburb is Luggate, which has a median house price of $805,300.

Over the last 2 years of all Queenstown-Lakes suburbs (Sep 2019 - Sep 2021), Lake Hayes had the fastest-growing house prices, at 13.27% per year. That is 29.61% slower than the median Otago house price.

The suburb that grew the slowest over that period was Frankton, which grew at a rate of 1.45% per year. That is 92.32% slower than the current median Otago house price.

Central Otago is made up of 10 suburbs. The most expensive suburb as of June 2021 is Bridge Hill, which had a median house price of $779,650. The most affordable suburb as of September 2021 is Ranfurly, which had a median house price of $356,150.

Over the last 24 months of all Central Otago suburbs (Sep 2019 – Sep 2021), Roxburgh had the fastest-growing house prices, at 21.23% per year. That is 12.59% faster than the median Otago house price over the same period.

The suburb that grew the slowest over that period was Cromwell, which grew at a rate of 7.78% per year. That’s 58.75% slower than the median Otago house price.

Waitaki is made up of 11 suburbs. The most expensive suburb is Omarama, which has a median house price of $532,800. While the most affordable suburb is Palmerston, which has a median house price of $365,000.

Over the last 24 months of all Waitaki suburbs (Sep 2019 – Sep 2021), Otematata had the fastest-growing house prices, at 18.12% per year. That is 3.85% slower than the median Otago house price over the same period.

The suburb that grew the slowest over that period was Weston, which grew at a rate of 9.97% per year. That’s 47.09% slower than the median Otago house price.

Clutha district is made up of 5 suburbs. The most expensive suburb as of September 2021 is Balclutha, which had a median house price of $390,350. The most affordable suburb is Lawrence, which has a median house price of $337,500 (Sep 2021).

Over the last 24 months of all Clutha district suburbs (Sep 2019 – Sep 2021), Milton had the fastest-growing house prices, at 23.83% per year. That is 26.42% faster than the median Otago house price of the same period.

The suburb that grew the slowest over that period was Balclutha, which grew at a rate of 21.90% per year. That’s 16.16% faster than the median Otago house price.

If you found this article useful, then you might also like our analyses on the other property markets in New Zealand. You can read all about the Auckland property market, the Wellington property market and the Christchurch property market by clicking any of the links mentioned here.