Real Estate Institute of New Zealand (REINZ) statistics show that while sales activity has trended downward, Southland property prices continue to climb.  

During February, Southland property prices increased 24.6% annually, from $390,000 in 2021 to $486,000 in 2022, reaching a record price for the region. 

All three territorial authorities (district or city council areas) reached record medians: Gore District ($435,000), Invercargill City ($484,500), and Southland District ($525,000).

Mararoa Waimea Ward, in northern Southland District, saw the biggest increase with the average house increasing from $474, 000 in February 2021 to $610,000 in 2022. 

Table showing median house prices across Southland District Wards (note Invercargill City is not included): REINZ/Supplied.

REINZ Chief Executive Jen Baird says the increase in price has been driven by people moving to Southland from elsewhere in the country. 

“There is strong demand from upper-end buyers moving from other areas of New Zealand as people reassess their goals and look for a lifestyle change.”

However, with more houses on the market in the region, attendance at open homes dropped and there were fewer bidders at auctions. 

“Market sentiment has shifted over the past couple of months which is evident throughout our February data,” says Baird.

“While prices remain strong — increasing annually in all regions — the number of sales continue to trend downwards and an influx of stock across New Zealand is easing demand side pressure, which may in turn further ease price growth in the coming months.”

“As a shift in sentiment sets in and buyers are less willing, or unable, to pay the prices we saw towards the end of 2021, pressure will come on vendors to adjust their expectations to meet the market.”

 Table showing number of property sales in Southland District Wards (note Invercargill City is not included) Table: REINZ/Supplied.

In the Southland region, including Invercargill City, the number of residential property sales decreased by 19% in February 2022, from 184 in February 2021 to 149. 

Baird says byers are increasingly showing caution, and while the appetite and demand for property remains, REINZ have heard from agents across the country that open homes and auction rooms are quieter.

“The increase in available properties and the subdued demand, is having a depressive effect on sales activity. Market sentiment has shifted and with pressure to buy easing, we are seeing less competition, less urgency and fewer sales,” she says.