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Tourist mecca Queenstown is facing a rough year ahead as visitor numbers plunge and its construction industry grinds to a halt, but it will likely spell good news for those who do visit.
The premier visitor destination is more exposed than most of New Zealand's cities and towns to the economic downturn because it relies so heavily on tourism and construction - sectors built on confidence and discretionary spending.
With less people travelling to New Zealand for holidays and less people investing in holiday homes or apartments, the outlook for the adventure capital appears grim.
"I think if you look at 2008, we will come to see it as the end of the golden weather," said Queenstown Lakes District Mayor Clive Geddes.
The number of visitors spending nights in the Queenstown region has already dropped 8 per cent, and thousands of foreign visitors who come every year on working holidays are likely to struggle to get the hospitality jobs they used to.
But Mr Geddes believes the region can claw back those losses with attractive new deals to encourage people to stay longer.
"There's no question that we can compensate for the lower visitor numbers we are expecting in 2009 by putting before them special offers that we haven't had before."
Destination Queenstown acting CEO Graham Budd said while many of the region's businesses were seeing a decline, others were still going "great guns".
Australia would be a big focus for Queenstown in 2009, with special autumn accommodation deals on offer.
The uniqueness of the alpine lake environment would be promoted to Australians as an "easy and close" alternative to the costly long-haul destinations in Europe and Asia, Mr Budd said.
Mr Geddes said construction in Queenstown had been on an "enormous roll" as affluent new subdivisions and hotels were built, but had now "stopped in relative terms".
"And it is far more difficult to create employment for the construction industry than it is to be smart about the tourism industry. There will be further job lay-offs and not a lot of alternative employment for people to turn to."
On the upside, young people who could not have dreamed of getting into the Queenstown property market might now have a chance.
And older people, with the economy in mind, might take their nest eggs and buy the dream retirement home in Queenstown area sooner rather than later, Mr Geddes said.
