Introduction
Looking to Invest or buy a property in Otago?
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.
Median Otago House Price
Otago's Median House Price is $721,000
As at December 2021, the median house price in Otago is $721,000. This is up from $270,000 10 years earlier. That means that the median Otago property increased in value by $45,100 on average.
The most expensive suburb in Otago is Lake Hayes, which has a median house price of $2,307,700 and is located in Queenstown-Lakes district. That means that Lake Haye's median house price is 2.20x Otago's median.
The least expensive suburb in Otago is Milton, which has a median house price of $389,300 and is located in Clutha district. That means that Lawrence's median house price is 46.01% cheaper than Otago's median.
Over the last 22 years (Jan 2000 – Dec 2021), Otematata had the fastest-growing house prices in all of Otago, at 11.61% per year. That is 37.59% faster than the median Otago house price.
The suburb that grew the slowest over that period was Balclutha, which grew at a rate of 7.48% per year. That’s 11.39% slower than the median Otago house price.
Otago House Prices Comparison with NZ
Otago's Median House Price is 10.14% above its long term average
On average, over the last 28 years, Otago's median house price has been 73.22% 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 December 2021, Otago's median house price was 83.36% of New Zealand’s median house price. That is 10.14% above its long term ratio, which suggests there is likely buying opportunities outside of the Otago region.
Council Breakdown – Over/Undervalued
Where are House Prices Most Over and Undervalued within the Otago Region?
This map shows a breakdown of how over or under-valued each council area is right now in the Otago property market. These figures are calculated exactly the same way as the graph in the above section.
The Clutha district appears to be the most over-valued. House prices there are about 8.43% 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 2.97% 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 Clutha.
Affordability
Where Are the Most Affordable Property In Otago?
The map below depicts which districts within the Otago Region have the most and least affordable house prices (REINZ, December 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 Otago region, with properties reaching an average price of $1,325,115 (December 2021).
By comparison, the Clutha District is the most affordable, with an average house price of just $387,000. That's an enormous $938,115 difference compared to Queenstown-Lakes.
Population Growth
Which Part of Otago Gets The Highest Population Growth?
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 Property Market
Dunedin City Property Market
Dunedin City is made up of 35 suburbs. The most expensive suburb is Maori Hill, which has a median house price of $1,031,750. While the most affordable suburb is South Dunedin, which has a median house price of $445,650.
Over the last 22 years of all Dunedin City suburbs (Jan 2000 – Dec 2021), Calton Hill had the fastest-growing house prices, at 9.92% per year. That is 17.47% 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 7.49% per year. That’s 11.27% slower than the median Otago house price.
Queenstown-Lakes Property Market
Queenstown-Lakes Property Market
Queenstown-Lakes is made up of 15 suburbs. The most expensive suburb is Lake Hayes, which has a median house price of $2,307,700. While the most affordable suburb is Luggate, which has a median house price of $878,200.
Over the last 2 years of all Queenstown-Lakes suburbs (Dec 2019 - Dec 2021), Lake Hayes had the fastest-growing house prices, at 20.23% per year. That is 18.97% faster than the median Otago house price.
The suburb that grew the slowest over that period was Frankton, which grew at a rate of 3.84% per year. That is 77.41% slower than the current median Otago house price.
Central Otago Property Market
Central Otago Property Market
Central Otago is made up of 10 suburbs. The most expensive suburb as of December 2021 is Mount Pisa, which had a median house price of $1,100,750. The most affordable suburb as of December 2021 is Roxburgh, which had a median house price of $415,050.
Over the last 24 months of all Central Otago suburbs (Dec 2019 – Dec 2021), Clyde had the fastest-growing house prices, at 16.96% per year. That is 0.26% slower 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 8.49% per year. That’s 50.06% slower than the median Otago house price.
Waitaki Property Market
Waitaki Property Market
Waitaki is made up of 11 suburbs. The most expensive suburb is Omarama, which has a median house price of $560,550. While the most affordable suburb is Kurow, which has a median house price of $400,850.
Over the last 24 months of all Waitaki suburbs (Dec 2019 – Dec 2021), Kakanui had the fastest-growing house prices, at 18.67% per year. That is 9.76% faster 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 12.43% per year. That’s 26.94% slower than the median Otago house price.
Clutha Property Market
Clutha Property Market
Clutha district is made up of 5 suburbs. The most expensive suburb as of December 2021 is Balclutha, which had a median house price of $417,500. The most affordable suburb is Milton, which has a median house price of $389,300 (Dec 2021).
Over the last 24 months of all Clutha district suburbs (Dec 2019 – Dec 2021), Milton had the fastest-growing house prices, at 23.46% per year. That is 37.95% 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 22.80% per year. That’s 34.07% faster than the median Otago house price.
Other Property Markets
Other Property Markets to Look Into
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.
Can Opes Partners help me?
Who are Opes Partners and can they help me?
What is the 3-Step Opes Coaching Programme?
1. Plan out your property investment portfolio
The first step in the programme is to co-create a plan using our MyWealth Plan software. We built this software specifically to help Kiwis create a financial plan in under an hour.
You'll leave this 1-hour session with a written down plan. Pen to paper.
2. Pick properties that fit with your plan
Once you've created your plan in step #1 – your property partner will go out and find properties that fit your plan. They'll search through projects from up to 58 developers to find the best ones for you.
When you meet again, you'll review the top picks, go through the analysis, crunch the numbers together, and then decide which ones to hold with the developer.
3. Dig into the details – Confirm it's the right property for you
Once you've selected a property, you'll work for 10 days to make sure it's the right property for you. So you'll work with your Property Partner and Client Relationship Manager to dig into the details of the property.
You'll go and look at the development and be introduced to mortgage brokers, solicitors, accountants, and property managers. Their sole job is to help you figure out if this property works for you.
And you’ll have access to all the resources, tools, and data … so when confirmation day comes, you have confidence you know you’re making the right decision.
Who is the Opes Coaching Progamme the right fit for?
- You understand the concept of property investment, but who wants help putting it into practice.
- You want a “Done for you” property investment service, so you can be a hands-off investor.
- You are someone who has at least a 10 year investment time horizon.
- And finally, you’re ready to become a property investor.
Who is the Opes Coaching Progamme is NOT the right fit for?
- You’re more into the smell of paint or the colour of a wall than the numbers that stand behind an investment property.
- You only want investments that are hands-on, so you can save a few dollars here and there.
- You have plenty of time on your hands and want to do the property investment process yourselves.
- You’re looking for an overnight success and want to get rich quickly.
What does it cost to work with Opes Partners and go through the programme?
It’s free. Complimentary. No Cost.
Why?
The developer pays us a marketing fee when you confirm that the property is the right fit for you. Very similar to the way a mortgage broker gets paid by the bank.
Now it's important to note that we are paid the same fixed rate no matter what property you invest in.
If it’s a $500k apartment in Christchurch or a $1.3 mil 3-bedroom townhouse in Ponsonby – we get paid the same rate.
That's important because then we can recommend the right property for you, and there's no incentive to recommend you invest in a more expensive property, just so we get paid more.
I want learn more about how Opes can help me
I want to build a passive income for my retirement and learn more about the Opes Coaching Programme.
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