Dunedin is home to the “scarfy” (meaning University of Otago student) and has a tradition of offering high-level tertiary learning and qualifications, mixed with the chance to have a heck of a lot of fun with other like-minded young people from around NZ and the world.
Investors have the option of purchasing and/or developing in the “hosting pot”, being the streets closest to the campus on the north side for mostly 2nd-year students fresh out of a year in the student halls to enjoy, or invest a street or two, or suburb back in the direction of the campus and provide accommodation for the slightly more discerning student being mainly 3rd to 5th year students.
Dunedin is no longer a one-horse town. Dunedin and its surrounding area have had above-average population growth matched with significant growth in property values and rental levels. Confidence in the city is high. The growth in townhouse developments being offered and purchased by both out-of-town investors and owner-occupiers has been significant in the last 24 months, especially in south Dunedin and surrounding flat suburbs. 36 townhomes in Caversham are due for completion in 2027, the largest non-student housing development in decades.
One of the key drivers of the recent surge in growth and rental shortage is the positive impact and growth of the city resulting from a new hospital being built in the city centre. Added to that is the announcement by the University of Otago of significant investment in infrastructure on the campus alongside and after the hospital rebuild.
Of interest to both “mum and dad investors” as well as larger property developers will also be the adoption by the Dunedin City Council of its Second Generation Plan (2GP), with among other things providing the opportunity for investors to develop inner-city sites which previously were not zoned capable of medium-density development.
Another key driver of the growth of Dunedin has been the explosion in tourism over the 5 years prior to COVID-19. Dunedin averaged 5,500 visitors daily, many of whom have made the trip south to see Dunedin’s renowned wildlife and heritage for themselves. A growing part of this sector is the cruise ship industry, which doubled in five years: 130 cruise ships were booked to visit the city of Dunedin via Port Chalmers for the 2020-21 cruise ship season. Dunedin also has an international reputation for fashion design and another major emerging sector in Dunedin is the gaming development industry. New Zealand’s Centre of Digital Excellence (CoDE) is located in Dunedin city centre, and it’s likely that Dunedin will become the epicentre of video game development in New Zealand.
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