Vauxhall becomes Dunedin's third million-dollar suburb

With stunning views of the city, Vauxhall sits above Portobello road with Andersons Bay and Shiel hill behind. Photo: Stephen Jaquiery
With stunning views of the city, Vauxhall sits above Portobello road with Andersons Bay and Shiel hill behind. Photo: Stephen Jaquiery
Median house values in four areas of New Zealand rose by more than $550,000 last year and three of those are in the Queenstown-Lakes District.

Kelvin Davidson, CoreLogic NZ chief property economist, said that the biggest gains were in Herne Bay, Arrowtown, Jacks Point and Lake Hayes.

Lake Hayes saw a jump of $653,900 in 2021.

But Davidson says the rises might not be repeated in 2022.

"New Zealand's housing market is due for a slowdown 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," he said.

In Dunedin, Vauxhall has broken the $1m benchmark, joining Māori Hill and East Taieri as the most expensive suburbs.

All 966 suburbs covered by CoreLogic's latest mapping the market report released this evening recorded an increase in median values last year, he said.

A West Coast town clocked the lowest gain: house values in Runanga, Grey District rose by just $29,500.

The Queenstown Lakes district median house price rose by $80,000 for September to again strike ...
Subdivisions Lake Hayes Estate and Bridesdale Farm (far right) near Lakes Hayes. PHOTO:STEPHEN JAQUIERY
Eight hundred areas had a median value rise of $100,000 or more.

Herne Bay remains New Zealand's most expensive suburb with a median property value of $3.605 million, up $558,050 or 18.3 per cent compared to December 2020.

St Marys Bay is the second most expensive, breaking the $3m benchmark for the first time, up 16.4 per cent annually.

"Despite Covid, snap lockdowns and border closures, Aotearoa's widespread residential real estate resilience rolled on unabated in 2021, ending the year with value growth recorded across the entire country," CoreLogic said.

The highest increases occurred in and around Tararua, Whangarei, Waikato, and Napier, but Rolleston in Selwyn where median values rose 41.7 per cent to $834,200 was a touch more surprising.

"The broad-based upturn across all suburbs has reflected a set of common drivers including low mortgage rates and a historically tight supply of listings across the country," Davidson said.

"The hottest markets lately have been around the central and lower North Island.

Arrowtown. Photo: Stephen Jaquiery
Arrowtown. Photo: Stephen Jaquiery
"Part of that reflects the lower starting price points of these areas and therefore better affordability," he said.

Christchurch's Rolleston was a bit of a 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, Davidson said.

Of the 966 suburbs on the interactive map, 698 recorded a lift in property prices of at least 20 per cent last year.

By New Year's Eve, New Zealand officially had 31 suburbs with median values of $2m or more: 28 in Auckland, one in Wellington's Seatoun, and two in Queenstown.

Only 36 suburbs had a median value of less than $400,000 and median values under $300,000 are in eight suburbs, most of those are located on the West Coast.

"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."

Grafton, Manukau and Auckland Central are the city's only three suburbs with medians of less than $700,000.

Hamilton ended 2021 with six $1m suburbs, with Rototuna and Queenwood the newest.

The suburb of Whitiora has the most affordable median value of $635,900.

Mt Maunganui remains Tauranga's highest value suburb with a median of $1.5m. Parkvale recorded the lowest value at $706,700, but that was still up $135,150 annually.

Seatoun is Wellington's most expensive suburb at $2.12m and the city has 67 suburbs with medians of $1m or more.

In Christchurch, Fendalton remains top at $1.56m. Christchurch has 14 suburbs with median values in excess of $1m.

Nationally, 83 per cent of suburbs' median values rose $100,000 or more last year.

Davidson stressed this shouldn't be misconstrued as a monetary 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.

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.\

The activity shows the impact low mortgage rates and tight listings. Affordability concerns that have emerged due to such significant dollar gains.

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