Housing boost planned for Queenstown

Known for its stunning landscapes and beautiful lakes, Queenstown is a tourism hotspot for New Zealanders and foreigners alike.

And all of this has also made it a popular place for people to buy houses for sale to occupy or rent out as holiday homes. From luxury lakeside estates to smaller units and townhouses, there's a lot to find in this beautiful part of New Zealand.

However, Queenstown is also known for being an expensive real estate market. Encouragingly, there is relief ahead for homebuyers looking to secure a home in this idyllic region.

Over 1,000 homes for Queenstown

Earlier this week (23 October), the Beehive and Queenstown Lakes District Council announced a plan to provide 1,300 homes in the region over the next three years. With a current median price of $664,000, according to housing minister Nick Smith, it can be hard to break into the Queenstown Lakes market for home buyers. However, with over 1,000 new homes on the way, affordability could be increased.

The Queenstown Lakes Housing Accord has already been signed by Queenstown mayor Vanessa van Uden and Dr Smith, which means the next step is for the government to identify areas in which to build these new homes.

Once these have been identified, some of the developments could be consented in the next two months.

"Queenstown has some unique characteristics to its housing challenge. The district has a high number of homes owned for holiday purposes, and there is high housing demand from people who work in the tourism and hospitality industries and who also tend to be on lower incomes," Dr Smith noted in a statement.

Strong activity for property in Queenstown Lakes

Figures from the Real Estate Institute of New Zealand (REINZ) illustrated a sharp rise for median prices in the Central Otago Lakes Region over the past year. According to REINZ research, prices have increased by 14.3 per cent, or $60,000, over the year to September 2014. In Queenstown itself, prices rose by a much larger 25 per cent over the same timeframe.

While this doesn't paint the brightest portrait for owner occupiers, it has nudged more investors into the Queenstown market. REINZ chief executive Helen O'Sullivan noted that "investors are taking a more active role in the market, with those buying for longer term investment horizons noticeably active."

At the same time, first home buyer numbers are disappearing.

However, with the announcement of 1,300 new homes in the next three years, there could be a pickup in this sector of buyers.