Almost 1000 New Zealand suburbs have experienced strong capital growth in the past 12 months, with a new report highlighting just how strong the market is.
CoreLogic’s Mapping the Market Report shows that all 966 suburbs grew in value while 698 recorded an increase in property prices of at least 20 per cent in 2021.
The largest gains occurred in and around the regions of Tararua, Whangarei, Waikato, Napier, and Rolleston (in Selwyn) where median values rose 41.7 per cent to $834,200.
After the strong period of growth, New Zealand now has 31 suburbs with median values of $2 million or more, including 28 suburbs in Auckland, one in Wellington (Seatoun) and two in Queenstown.
Four suburbs registered gains of more than $550,000 including Herne Bay in Auckland and Arrowtown, Jacks Point, and Lake Hayes in Queenstown. While the smallest dollar gain in 2021 was Runanga (Grey District) at $29,500.
CoreLogic NZ’s Chief Property Economist Kelvin Davidson said the widespread gains show how strong the overall market has been.
“The broad-based upturn across all suburbs has reflected a set of common drivers including low mortgage rates and historically tight supply of listings across the country,” Mr Davidson said.
“The hottest markets lately have tended to be around the central and lower North Island.
“Part of that reflects the lower starting price points of these areas and therefore better affordability. Rolleston was a small surprise, because there’s been so much construction there in the past year and while it’s had a flatter performance in the past, at the moment people are recognising better affordability and looking to buy, and that demand has begun to flow through to prices.”
Only 36 suburbs had a median value of less than $400,000 across the country and Mr Davidson said that it’s getting harder for home buyers to get into the market.
“It’s getting harder for home buyers to seek out affordable areas and that’s why we’re seeing them do other things too – such as tapping their KiwiSaver for a deposit or seeking a compromise on property type, for example opting to purchase a townhouse instead of a standalone house,” he said. “It’s certainly not going to be easy this year, but not impossible; our own data still shows that many first home buyers are successfully finding a way into the market,” said Mr Davidson.
Mr Davidson said 83 per cent of suburbs saw a median value rise of $100,000 or more in 2021, but this wasn’t a windfall for homeowners.
“With any increase somebody has to pay and these gains ‘on paper’ for existing owners come at the expense of would-be buyers,” he said.
“And people looking to sell and trade up in the same market may not necessarily benefit either, particularly if their next property has risen by more than theirs.
“New Zealand’s housing market is due for a slow down this year as affordability bites, mortgage rates rise, lending rules tighten and with more choice on the market for buyers, we would expect a dampening on price pressures.”
Auckland
Across Auckland, there are now 28 suburbs with median values of $2 million or more and 153 suburbs in the $1 million to $2 million range. Grafton, Manukau and Auckland Central are the city’s only three suburbs with medians of less than $700,000.
All suburbs have seen median values rise over the past year, with six having seen gains of 30 per cent or more, led by Otara at 36.2 per cent.
Hamilton
Hamilton ended 2021 with six million-dollar suburbs, with Rototuna and Queenwood the newest to join the exclusive club. The suburb of Whitiora has the most affordable median value at $635,900.
All suburbs have seen median values rise by at least 15.9 per cent over the past year, with Flagstaff up 27.7 per cent.
Tauranga
Mount Maunganui remains Tauranga’s highest value suburb, with a median of $1.5 million at the end of 2021.
Parkvale recorded the lowest, at $706,700, which was still an increase of $135,150 for the 12 months to December.
Each suburb has seen growth over the past year between 24 per cent (Gate Pa and Parkvale) and 34 per cent (Mount Maunganui).
Wellington
Seatoun is Wellington’s most expensive suburb with a median value of $2.12 million, and 67 suburbs have medians of $1 million or more.
All suburbs have seen growth over the past year of at least 11 per cent, including Riverstone Terraces (Upper Hutt) which experienced capital growth of 36.1 per cent.
Christchurch
Fendalton remains Christchurch’s most expensive suburb ($1.56 million median value), with 13 others now with a median price of more than $1 million.
Hornby has grown the most over the past year (34.9 per cent), although 27 other suburbs have also exceeded 30 per cent growth.
Dunedin
Vauxhall has now joined Maori Hill and East Taieri with a median price of more than $1 million.
The increases over the past year have ranged from 23.9 per cent in Ocean View to 10.9 per cent in Opoho.
