West Coast Property Market

Introduction

Looking to Invest or buy a property in the West Coast?

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

The West Coast property market is made up of 3 districts and 14 suburbs. These districts are the Grey district, Westland and Buller.

Median West Coast House Price

West Coast’s Median House Price is $230,000

As at February 2020, the median house price in West Coast is $230,000. This is up from $43,000 10 years earlier. That means that the median West Coast property increased in value by 2.09% each year, or $4,300 on average.

The most expensive suburb in the West Coast is Moana, which has a median house price of $440,850 and is located in Grey district. That means that Moana’s median house price is 1.92x the West Coast’s median.

The least expensive suburb in West Coast is Runanga, which has a median house price of $145,250 and is also located in Grey district. That means that Runanga’s median house price is 36.8% cheaper than the West Coast’s median.

Over the last 18+ years (Aug 2001 – Mar 2020), Reefton had the fastest-growing house prices in all of the West Coast, at 7.01% per year. That is 1.89% faster than the median West Coast house price.

The suburb that grew the slowest over that period was Greymouth, which grew at a rate of 4.53% per year. That’s 3.42% slower than the median West Coast house price.

West Coast’s House Prices v.s. NZ House Prices

West Coast’s Median House Price is 30.1% below its long term average

On average, over the last 27 years, the West Coast’s median house price has been 48.74% of New Zealand’s median house price.

Assuming the long term fundamentals of either property market have not changed, the West Coast’s median house price would track back to this long term average.

That would usually suggest that when the West Coast’s median house price is below its long term average, there is a buying opportunity. When West Coast’s median house price is above its long term average, that would usually suggest there are buying opportunities in other regions.

As of Dec 2019, the West Coast’s median house price was 34.06% of New Zealand’s median house price. That is 30.1% below its long term ratio. That would usually suggest there is a buying opportunity in West Coast – as long as the long term fundamentals of the market haven’t changed.

However, our view is that long term fundamentals of the West Coast property market have changed. That would suggest that this model’s conclusion – that the West Coast is under-priced compared to its long term average – would not hold.

What has structurally changed in the West Coast? The West Coast is the only region in New Zealand that is forecast to decline in population over the next 20 years. As New Zealand’s population grows, the West Coast will make up a smaller and smaller proportion of the overall population.

The West Coast’s economy has structurally changed over the last 2 decades. The mining industry, previously one of the West Coast’s main industries, has declined significantly. In addition to this, Tourism makes up 16% of the West Coast’s economy. This will be significantly negatively impacted from the Covid-19 epidemic.

That is why we believe that the West Coast property market will not likely return to its long term average position at 48.74% of New Zealand’s median house price.

Buller Property Market

Buller Property Market

The Buller district is made up of 4 suburbs. The most expensive suburb is Carters Beach, which has a median house price of $307,100. While the most affordable suburb is Reefton, which has a median house price of $193,250.

Over the last 12 months of all Buller district suburbs (Mar 2019 – Mar 2020), Reefton had the fastest-growing house, at 19.25% per year. That is 8.55% slower than the median West Coast house price over the same timeframe.

The suburb that grew the slowest over that period was Carters Beach, which grew at a rate of 7.85% per year. That’s 62.7% slower than the median West Coast house price.

Grey Property Market

Grey Property Market

The Grey district is made up of 8 suburbs. The most expensive suburb is Moana, which has a median house price of $440,850. While the most affordable suburb is Runanga, which has a median house price of $145,250.

Over the last 12 months of all Grey district suburbs (Mar 2019 – Mar 2020), Moana had the fastest-growing house, at 16.9% per year. That is 19.9% slower than the median West Coast house price over the same timeframe.

The suburb that grew the slowest over that period was Greymouth, which grew at a rate of 3.13% per year. That’s 85.1% slower than the median West Coast house price.

Westland Property Market

Westland Property Market

The Westland district is made up of 2 suburbs. The most expensive suburb is Kaniere, which has a median house price of $315,600. While the most affordable suburb is Hokitika, which has a median house price of $274,700.

Over the last 12 months of all Westland district suburbs (Mar 2019 – Mar 2020), Hokitika had the fastest-growing house, at 7.07% per year. That is 66.4% slower than the median West Coast house price over the same timeframe.

The suburb that grew the slowest over that period was Maniere, which grew at a rate of 4.66% per year. That’s 77.9% slower than the median West Coast 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.