Southland’s property market is on the rise, with the latest figures showing significant increases in property values since 2021. As ratepayers prepare to receive their updated three-yearly valuations, let’s take a closer look at the trends shaping the region.
Residential property values have jumped by an average of 19% over the past three years. The average house value in Southland is now $532,000, with residential land values also climbing by 19.7% to $205,000. Among larger towns, Te Anau stands out, recording a 26% increase in average residential property values. Winton followed with an 8% rise, while Riverton saw a 12% growth. This steady upward trend reflects a resilient property market, bolstered by a combination of factors, including Southland’s historically lower property prices. According to Quotable Value (QV) valuer Tim McCaw, the early market growth in 2021 and 2022 has since been tempered by rising interest rates and a higher cost of living. However, Southland’s lower property base has offered some protection from the slowdown experienced elsewhere.
Lifestyle Properties in High Demand
Lifestyle properties have emerged as a particularly strong segment, with capital values up by 21.2% to an average of $718,000. Land values in this category also grew by 20.2%, now sitting at $334,000. The demand for larger, versatile properties continues to grow as more people prioritise space and flexibility.
Commercial and industrial sectors thrive
Commercial property values in Southland have risen by 15.1%, while industrial property values have seen a 16.4% increase. Land values in these sectors experienced even greater growth, with commercial land up 23.5% and industrial land rising by 23%. These figures highlight a thriving market for business and industrial investments in the region.
Modest gains for rural land
The rural sector has seen more measured growth, with values increasing by 3.2% overall. Dairy properties led the way, recording a 7.2% increase, while pastoral properties grew marginally by 0.5%. McCaw noted that regulatory changes, environmental pressures, and fluctuating commodity prices have significantly influenced the rural market. While some pastoral properties have benefited from land-use changes to forestry, others are facing challenges, particularly those less suited to alternative land uses like dairy support or forestry.
Southland’s total rateable value has reached $28.6 billion, marking a 10.8% increase since 2021. The district’s land values now stand at $19.21 billion, up 8%. These figures underscore the growing economic importance of Southland’s property market.
Updated rating valuations provide an estimate of what a property might have sold for on 1 July 2024, excluding chattels. Ratepayers should note these valuations are used to calculate rates, and changes in value may impact their contributions to council funding. If you’re a ratepayer who disagrees with the valuation, you can file an objection with QV before the 24 December deadline. This process ensures homeowners have a fair opportunity to address any discrepancies.
Southland’s property market continues to evolve, offering growth opportunities across residential, lifestyle, and commercial sectors. However, the challenges faced by the rural sector remind us of the complexities inherent in adapting to economic and regulatory changes.
Understanding these trends is crucial whether you’re a homeowner, investor, or prospective buyer.
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