In recent times, Dunedin has seen an upswing in property values—something that is likely to continue into 2019. Research analyst Kelvin Davidson said that average values increased by 11.2 percent in 2018; in the past four years, they have risen by 48.8 percent. Demand continues to be strong, and the number of listings on the market is low. Both first home buyers and investors have been keen to buy in recent months, despite the changes to laws surrounding rental properties and the required insulation standards. However, the lower starting point for values in Dunedin and the higher gross rental yields are outweighing the concerns.
Kelvin Davidson predicts that the longer and higher values rise, the more likely it is that current owners who have been watching the market will take the plunge and look to ‘cash in’— at which point, the associated rise in listings would subsequently take some of the steam out of price gains. “However, for 2019 at least, this possible effect doesn’t seem likely to be a game-changer for Dunedin, and it’s set for another strong run.”