Why Christchurch values continue to hold their own
Why have Christchurch property values continued to hold their own despite a nationwide downturn in the property market? 🤔🏡
Read: 'Robust' Christchurch house values weather the storm, Stuff.co.nz
Firstly, the post-quake years saw a very balanced market as we saw a proliferation of new home construction which largely met buyer demand. Prices only increased 11% between February 2014 to February 2020.
It helps to look at what Christchurch-specific factors drove prices up in 2020 - 2021, aside from what fueled property boom across NZ. We saw an influx of buyers from other main centres, who were attracted to Christchurch's relative affordability, attractive lifestyle options and overall quality of housing stock. It was more affordable to buy a property in Christchurch than it was in Dunedin!
The market in Christchurch has had a softer landing than other main centres because it grew from a more affordable base. Pre-pandemic, there were already concerns about housing affordability in Wellington and Auckland. The montetary policy decisions in 2020 simply exacerbated it. The same affordability concerns didn't apply to Christchurch pre-pandemic.
I'm still expecting that rising interest rates and economic uncertainty will put downward pressure on prices, but I do think this pressure will be offset by fewer properties becoming available as homeowners hold tight, in addition to Christchurch's affordability relative to Auckland and Wellington.
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