The Price of Paradise: Humble holiday homes in this once affordable town are now selling for $3m
Saturday, 11 April 2026
Who Owns Queenstown is an investigative series by The Press looking at property ownership in the Queenstown Lakes District. Here CHARLIE MITCHELL considers how the district became one of the least affordable in the developed world.
On a cloudy afternoon in Arrowtown, an auctioneer stood on a concrete patio and made his pitch.
'Gold is what Arrowtown is famous for,' he said. 'Real estate gold is what's on offer today.'
Behind him sat a crib — a bach, for those north of the Waitaki — that might have belonged anywhere in New Zealand. Nothing about its white weatherboard exterior, vintage carpet, the slowly rusting swing set in the backyard, boasted wealth.
It had been held by one family for decades; the kind of place a Dunedin accountant or an Invercargill electrician might have built, back when that was attainable.
The bidding opened at $2.5 million. It closed, a few minutes later, at $3m. Weeks later, the neighbouring property — an even older bach — also sold for more than $3m.
Real estate, after all, is the new gold.
Arrowtown is not an outlier. Once a quiet gold-mining settlement between Queenstown and Wānaka, it now sits near the centre of one of the most pressurised property markets in the developed world.
In 2000, the average Arrowtown house was worth about $350,000 in today’s dollars. By 2015, that had climbed to $1.3m. This year, it crossed $3m.
In the past 12 months alone, values have risen by an average of $317,000, nearly three times the median household income.
The trajectory holds across the Queenstown-Lakes district. Average house prices sit somewhere between $1.6m and $2.1m, roughly double the national figure and well ahead of Auckland.
Lake Hayes has also crossed the $3m mark, while Kelvin Heights, a peninsula extending into Lake Whakatipu, is close behind on $2.8m.
By one widely used measure, housing is considered 'impossibly unaffordable' when prices exceed 9 times household income. In Queenstown-Lakes, the ratio recently surpassed 16. An average household saving for a deposit would now take, on average, more than two decades.
Renters spend about 37% of their income on housing — well above the national average — and affordable houses have effectively vanished.
In The Press’s new series, Who Owns Queenstown?, we ask how a district once defined by cribs and family holiday homes — where houses cost roughly what they did in Palmerston North — become the least affordable district in one of the least affordable housing markets in the developed world?
The Press has analysed the Queenstown-Lakes District's rating database, which covers around 33,000 rating units worth nearly $75 billion. Each property was matched to its owner through government records.
The scale of what we found is easier to understand when set against another New Zealand city. In our property project Who Owns Christchurch?, The Press reported the city’s 184,000 rating units are worth nearly $175b — five times as many properties, but just over twice the total value.
Ownership patterns diverge as well. In Christchurch, property is dominated by institutions — the Crown, the council, churches, schools. In Queenstown-Lakes, private companies and trusts have an outsized presence, with hundreds of those entities registered offshore, most commonly in Australia and Singapore.
At the same time, ownership is less concentrated. Where Christchurch has its share of large-scale landlords, Queenstown has relatively few owners with more than a handful of properties. Wealth here is widespread, but uneven, tied to land values rather than housing portfolios.
That land, and who holds it, is where the story begins.
A changing district
There are, in effect, two Queenstowns.
One exists in films and tourism campaigns: a basin of light and shadow, the Remarkables rising in near-perfect symmetry above a cerulean lake.
We export this Queenstown to the world. British actor Stephen Fry once called it “the greatest sight on earth”. When a Russian prime minister was ousted in the 1990s, he jumped on a plane to Queenstown, telling his guide that, 'If New Zealand is not a paradise, tell me, where is a paradise?'
The other Queenstown is harder to sell. It is a place where the workforce sustaining the visitor economy is pushed into expensive, often insecure rentals. Where companies and trusts — hundreds of them registered overseas — own one in three properties. Where the waiting list for community housing has reached 1600 households, roughly 8% of the district's population.
Ralph Hanan spent 29 years as a senior economist at the World Bank before retiring to Queenstown. Soaring house prices here, he says, reflect a mismatch: a global asset market sitting on top of a local economy.
“Unlike anywhere else in New Zealand, [housing] is a global asset class and it is subject to global demand,” he says.
“Yet everything else here in Queenstown — the labour and the tourism — is rather local.”
High housing costs and low productivity are a nationwide problem, he says, but Queenstown is where that reaches its logical extreme. Despite some of the country's highest land values, the district’s productivity per worker is well below the national average — a figure, Hanan notes, that counts only what is actually produced here, not the wealth of those who simply own it.
Our analysis shows that than 1200 residential properties in the district, or just over 5% of the total, are valued at $5m or more — roughly 10 times the national proportion. Around 50 properties are worth at least $15m.
At this level, sales regularly exceed official valuations, sometimes dramatically. A historic Wānaka farm recently sold for $30m, approximately 30% above its rateable value. The buyer's identity is obscured by a trust, though The Press understands it is linked to a prominent New Zealand family.
The district's single most expensive private residence sits on a private peninsula near Wānaka: a nearly $33m estate owned by a senior manager at the global consultancy McKinsey. A Canadian entrepreneur and a former Olympic rower recently paid $14m for a property in Wānaka, while nearby, a property owned by developers Tony Bunting and Elaine Tassie is listed for sale with an indicative price of around $14m.
The Lake Hayes corridor has become its own enclave. Sir Russell Coutts owns a farm with a private golf course valued at around $31m. Businessman Sir Rod Drury is building what is set to become one of the country's largest private homes. Australian billionaire Tim Roberts owns a $12m compound on Malaghans Road, while a prominent comedian recently paid $9.5m for a property near Arrowtown.
On the eastern shore of Whakatipu, the son of a Singaporean billionaire recently paid $22.5m for a house and neighbouring land. Along the same lakefront, properties are owned by an American cryptocurrency investor, the co-owner of a conservative American broadcasting network, and members of prominent families from Singapore and Hong Kong.
Closer to Queenstown, Fady Mishriki — an Auckland entrepreneur who sold his wireless charging company to Apple — has bought a cluster of six lake front properties for a combined $21m, along with another nearby property for $5m.
Along the picturesque road to Glenorchy, Graeme Hart — New Zealand's wealthiest person — owns a mansion and land worth a combined $29m. A planned $30m holiday home nearby, to be sold under a private membership scheme, received resource consent last year. In Glenorchy itself, a company linked to Kim Dotcom has listed a house worth nearly $16m. On the same street, formerly Singapore-based hedge fund manager Richard Magides owns a property worth over $19m; nearby, Australian tech investor Sheona Devin owns another valued at around the same figure.
This is just a snapshot of the global wealth that has entered the district. Recent changes to overseas investment rules are expected to accelerate the trend. Foreign buyers can now buy or build homes over $5m if they commit capital domestically. When the changes were announced, online searches for high-end properties surged.
At the lower end of the market, options are more limited.
About 4000 properties have a rateable value under $1m, three-quarters of them units or apartments, with an average value around $700,000. Many are small, one-bedroom units near the airport.
Affordable standalone housing has effectively vanished.
Our analysis found just one standalone property in the district worth less than $500,000: a dilapidated hunting crib in Makarora, on the way to the West Coast.
How it happened
For much of its history, Queenstown was remote — valued for its beauty, but constrained by access. Travel from the south once meant a laborious train journey to Kingston before boarding a steamer across the lake.
The modern transformation began after the Second World War. The opening of Coronet Peak in 1947 established Queenstown as a winter destination, complementing a largely summer tourism base. Soon after, the culture of the crib took hold: simple, often self-built holiday homes owned by families from Dunedin and Invercargill, scattered along the lake edges at Kelvin Heights.
In Wānaka, which was called Pembroke until 1940, development was slower. Lakefront sections were balloted to prospective crib-owners in the 1950s, the assumption being that this was land for ordinary people. One such property sold last week, having expected to sell for more than $7m.
By 1981, the average Queenstown-Lakes house cost about $220,000 in today's dollars — above the national average, but comparable to Napier or Palmerston North.
Then the world found it.
International film productions arrived. Tourism expanded, and the housing market picked up. Demand for sections in 1985 was high, The Press reported, driven mostly by anticipated capital gains. The town was suddenly under strain: Young people were living in boatsheds and stealing food to get by. A place that had once been, as one report put it, a 'sleepy hollow in a little-known part of the country' was becoming something else entirely.
The decisive shift came in 1995, when the first direct trans-Tasman flight landed from Sydney. What had been a regional holiday town began to operate within a global market. Prices followed. By 2005, houses had soared to nearly $500,000, higher than anywhere in New Zealand except Auckland's inner suburbs. Kelvin Heights, the former crib community, became the country's first million-dollar suburb.
The geography that once protected Queenstown from runaway growth — the inhospitable mountains and cavernous lakes — had become, paradoxically, the engine of it.
Housing supply is not keeping pace. Queenstown-Lakes has consented around 1800 new dwellings this year — more than any council except Auckland and Christchurch, and at a per-capita rate roughly ten times that of Wellington. Construction is happening. It is not happening fast enough, or cheaply enough, to change the arithmetic.
Hanan is sceptical it ever will. He argues New Zealand should introduce a land tax on unimproved land, to discourage the banking and speculation he sees as driving prices across the country, not just in Queenstown.
The solution for Queenstown, in his view, is not to chase global demand with local supply, but to insulate the people the district needs most — nurses, teachers, police officers — from a market they can no longer participate in on ordinary terms.
“I don't see how you can improve the productivity of the local workers here or to reduce the global demand for housing,“ he said.
”It is what it is. But we can do a lot more to assist the people whom we need here to be able to afford to live here.“
In the coming weeks, this series will examine more aspects of the Queenstown Lakes District’s property market, with stories about the country’s most exclusive community, the long-held family cribs that have quietly become multimillion-dollar assets, to the shrinking pockets where housing remains — relatively, for the time being — within reach.