First home buyers looking for affordable homes in Auckland’s inner west are having to bump up their budgets to just over $1 million.

House prices in Avondale, Blockhouse Bay and New Lynn have jumped more than 30% in the last 12 months as buyers scramble to secure real estate close to the city and on transport lines.

READ MORE: Find out if your suburb is rising or falling

A year ago, buyers could reasonably expect to get a home in the suburbs for around $800,000, but recent sales suggest they could be paying upwards of $1.5 million, as they compete against investors and developers.

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In Avondale, a large family home on Plane Street sold under the hammer last week for $1.9m – nearly double its CV – while a three-bedroom bungalow on Rickards Place in New Lynn fetched $1.56m at auction.

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A pair of houses on 1525sqm in Seabrook Avenue, New Lynn, west Auckland sold this month to a developer for $3.6m. Photo / Supplied

Barfoot & Thompson agent Anna Lechtchinski, who has sold in the area for over 25 years, says Avondale is still buyers’ first pick.

“They end up in New Lynn not because it’s their first choice, but because they can’t afford Avondale.

“New Lynn has some offerings, but it doesn’t have Avondale College, nor as good primary and intermediate schools. And it’s further from the city – Avondale was old Auckland City, more like Mount Albert or Waterview, while New Lynn was Waitakere, west Auckland.

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A two-bedroom bungalow in need of renovation at Saint Georges Road, Avondale sold at auction for $1.267m. Photo / Supplied

“It’s geography - the further from the Sky Tower, the less appealing.

“Twenty metres down the road, it’s completely different prices. Avondale is rising faster than Blockhouse Bay and New Lynn."

Avondale’s freestanding houses are still preferred over the terraces and townhouses of New Lynn, Lechtchinski says, with a bungalow on a cross-lease site there now fetching $2m. Earlier in the year it would have fetched $1.4m, she estimates.

This week a five-bedroom classic brick two-storey house she was marketing on Plane Street, Avondale, sold at auction for $1.906m. Another smart 1940s four-bedroom house in nearby Batkin Road, New Windsor fetched $1.8m with nine bidders competing for the home.

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A six-bedroom home on Lynbrooke Ave, Blockhouse Bay sold for $1.935m, $600,000 above its CV. Photo / Supplied

“Four bidders kept going until the last cent. That’s how the market moves and people are putting their hands up.”

Rather than face disappointed buyers turning up to an auction that starts way out of their price range, Lechtchinski provides them with the same price appraisal she’s given to vendors to set realistic expectations.

“It’s a very, very difficult market for buyers, it doesn’t need to be more complicated.”

Newly built terraces and townhouses are coming to Avondale, she says. A development she is currently marketing offers 42 houses with one-bedroom studios starting at $599,000 through to three-bedroom 145sqm houses for $1m-$1.1m.

Lechtchinski is worried at the quality of some of the new properties coming to market.

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A five-bedroom home on Plane Street, Avondale sold at auction this week for $1.906m. Photo / Supplied

“It’s the wild west at the moment. Buyers don’t do their due diligence on whether the builder can complete the project. I wouldn’t take a client who can’t complete, it’s my face on the fence.”

She sees a growing trend of developers holding onto terraces they’ve built to rent for five years until they are outside the bright-line period and can sell tax-free.

The nearby suburb of Blockhouse Bay is the least changed of the three, with less change from density zoning of the Unitary Plan – largely due to the fact that it is not on a railway line like New Lynn and Avondale.

“It’s a very conservative part of the market. With a good village, good primary school it’s [a] super desirable magnet for families. It’s more settled, a much stronger community, it’s holding ground.”

Darin Johnston, Harcourts business manager for Avondale, Te Atatu and New Lynn branches, says that developments on sites as small as 600sqm to 800sqm are “just going crazy.”

“There are so many bidders and a lack of stock for everything. People looking at Avondale, are coming over to New Lynn, they’ll buy anything at the moment. There are not enough standalone houses, so many people have to look at terrace housing,” he says, adding that the company is marketing some 30 new homes from five projects across the inner west at the moment.

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A classic 1950s three-bedroom house on Shoreham Street, Avondale sold for $1.19m. Photo / Supplied

Barfoot & Thompson agent Gail Beaton, who this week with Kevin He sold a three-bedroom weatherboard 1950s home at Golf Road, New Lynn under the hammer for $1.125m (its council valuation is $830,000), says that there is a shortage of standalone houses.

“We had eight bidders for this, first-home buyers and some downsizers.

“Not everyone wants to live in a terrace, there’s a lot of development going on and not much in the way of established homes. It puts an awful lot of pressure on buyers.

“Their first pick is Avondale, but now New Lynn is going ahead. It’s become quite popular because it’s right on the train and bus stations.

“People are looking at how easy it is to get into the city.”

Some family homes are falling to development dollars, but not all are being turned into new homes immediately. Last month a pair of properties in Seabrook Avenue, New Lynn, zoned for urban density, sold under the hammer for $3.6m, more than twice their combined council valuation of $1.63m.

Barfoot & Thompson agent Cherry Wang, who marketed the properties with Ellie Wang, said the buyer, one of three bidders, was buying large flat sites all over Auckland, but planned to land-bank the property in the short term and continue renting the two- and three-bed 1950s houses.

“They’ve got a lot of cash, they’re just looking all over Auckland for big, flat land.”