Tourism is said to be the main reason that the average house value in the Tekapo district is now over $850,000.
Capital rateable values for residential properties in the Tekapo region climbed by more than 58 per cent in the past three years, the latest release from Quotable Value (QV) shows.
The average house value for Tekapo is now $862,000 while the total capital worth of all residential and non-residential property in the Mackenzie region has been put at $4.13 billion.
In other Mackenzie areas, house values also climbed by 55.7 per cent in Twizel and by more than 24 per cent in Fairlie.
Residential values overall are now, on average, more than 53 per cent higher across the Mackenzie district than they were three years ago, with residential land values on average over 79 per cent higher than they were in 2014.
The report is a result of the triennial rating revaluation being carried out by QV for the Mackenzie District Council.
Average house values in Twizel and Fairlie have been put at $417,000 and $268,000 respectively.
By comparison, the capital value of the average house in the Timaru district has been put at $360,000, an increase of 21 per cent since 2014 - and the total value of all property in the district has been put at $13,904,411,000 with the land value of those properties now valued at $7,175,819,000.
Registered QV valuer Gail Smits said demand in the Mackenzie was driven by domestic and international tourism.
"The biggest increases in residential value are in Twizel and Tekapo, with many of these houses and vacant land sites being purchased for holiday homes."
Mackenzie District Mayor Graham Smith said the rateable values were "great news" for the district, and stressed the climbing house prices would not be reflected in rates.
A rates rise of about 8 per cent was on the cards, however, to help the district with "growing pains" when it came to infrastructure.
Local people being priced out of the market was "a bit of a concern", but house prices did vary throughout the Mackenzie district.
Real estate agent Steve Howes agreed tourism was the key driver, and predicted that when the next round of figures came out for the actual house prices they would either match or exceed the ones contained in the Quotable Value report.
"Tekapo is now becoming a destination of choice, rather than a stopover. There are very strong and very positive returns.
"Travellers passing through are making a place to stay at Lake Tekapo.
"There's very, very high demand and low supply."
Values had been rising over the past three years, but Howes said he noticed a definite boom in the past 18 months.
According to the QV figures, house prices in the Mackenzie are third highest in Canterbury, behind the Selwyn and Christchurch districts.
Howes said where properties could be used as visitor accommodation, the market price for places in Lake Tekapo could climb higher than $862,000.
When it came to the type of buyers the new house prices would attract, it was too early to say who they would be, Howes said.
Mackenzie District Councillor Russell Armstrong, based in Twizel, said on the whole the increasing rateable value was a good thing, but he was not completely sure if the amount of $417,000 truly reflected what Twizel properties were worth .
"Old Twizel houses are not really worth that kind of money," he said.
People would be better off building new houses, he said.
"Most people these days don't really want a bach, they want a house."
The updated rating values, once finalised, will be used as one factor to help the council set rates for the next three years from 2018.
Current market valuations require an individual inspection of a property and full written report by a registered valuer.
Rating values are also not designed for insurance purposes to reflect the replacement value of a home; an insurance valuation is required for this purpose.
Mike Pero real estate agent Coralie Reid said it was a case of "classic supply and demand".
Despite the rise in value Twizel's base population was about the same, she said.
"There has been a strong increase in asking prices and things.
"It's people are just seeing the opportunity to secure a property in the Mackenzie District."
There was "a lot more opportunity for everyone as well".