Dunedin Property Report - November 2021 (Oct 2021 stats)
October produced a further rise in the median sale price which is now up 20.5% year-on-year to a record of $675,000. There were 35 sales over $900,000 and 20 at over $1 million.
Despite a number of media outlets and commentators having predicted that the market had peaked, the Dunedin market continues to show relentless price growth. Building activity is strong, but labour shortages, material shortages and a lack of available sections are still holding back potential growth that may temper the underlying imbalance between supply and demand. When combined with Dunedin’s continued population growth and strong interest from outside the city, it is easy to see how this pressure continues to lift prices.
The number of days to sell was back down to expected levels at 28 days after the increase due to the lockdown’s influence in the September statistics.
There were 8 section sales for the month spread across the city. Based on enquiry there are many people keen to build, but as mentioned above, there are very few sections available, especially in the city’s main suburbs.
With the first rise in the OCR in seven years, we have seen an increase in bank interest rates. We are also seeing Loan to Value Ratios being strongly enforced by the banks, especially with investors. Ninety percent of owner occupier loans now require a 20% deposit while investors now require a 40% deposit. The Reserve Bank have done this partly in an attempt to stall inflation which, while sitting currently at 4.9%, is somewhat higher than the 1% - 3% percent they prefer.
In the immediate future it appears we will continue to see prices grow but it is anticipated that they are likely to even out in 2022.
Joe Nidd AREINZ