Auckland's average property value jumped more than $300,000 in the last year to $1.568 million, putting more pressure on first home buyers in city.
Unlike other parts of the country, where rising interest rates, tougher lending conditions and increased listings, have started to take the heat out of the market, buyer activity in Auckland has remained reasonably strong, with the city's average property value in the three months to the end of December growing 7%, according to the latest figures from the OneRoof-Valocity House Value Index.
For those looking to buy in Auckland, the surge in house prices has limited their options. A 20% deposit on a typical Auckland house would be $313,600 - $63,400 more than what first home buyers faced a year ago.
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The number of affordable suburbs within the city has significantly shrunk over the same period.
Of the 224 Auckland suburbs that had 20 or more settled sales in 2021, only 20 had an average property value of less than $1m at the end of December, down from 55 in December 2020, and 101 five years ago.
The majority of the 20 sub-$1m suburbs are in South Auckland and on the fringes of the city, with the furthest flung from the CBD Great Barrier (Aotea) Island and the closest Auckland Central.
Eight of the suburbs have an average property value of less than $900,000, with Auckland Central, dominated by one and two-bedroom apartments, sporting the lowest average property value, at $648,000, while Mangere East is just $1000 away from hitting $1m and dropping out of the rankings altogether.
The average property value covers houses, apartments and units, meaning first home buyers could find a property for less than $1m in more suburbs, but the figures indicate the direction of house prices in the city.
Here is a guide to all 20 suburbs where, according to OneRoof-Valocity data, the average property value is less than $1m.
Distance from Auckland CBD - less than 5km
Known as the Auckland's shoebox suburbs, Auckland Central, Eden Terrace and Grafton are home to a large number of one and two-bedroom apartments. Typically favoured by first home buyers, investors and international students, the suburbs have not enjoyed the post-Covid lift that the rest of the city's suburbs have. However, homes here are close to some of the city's best bars and restaurants and for city workers they boast a ridiculously short commute time.
Auckland CBD. The suburb has the city's lowest average property value. Photo / Getty Images
Distance from CBD - 5 to 20km
On the south side of Manukau Harbour, Favona, Otahuhu, Mangere East and Otara are traditional working class South Auckland suburbs that have shot up in value in the 12 months, thanks to the Auckland Unitary Plan. Much of the buying activity in the suburbs has been by developers, attracted by the relatively low price of former state homes that they can bowl and replace with higher-priced terrace housing or apartments. Tougher credit conditions and the recent spike in the price of building materials could thin out the competition for first home buyers in the suburbs in 2022.
Distance from CBD - 20 to 40km
Further south and heading towards the city fringes are Manukau, Wiri, Clendon Park, Manurewa, Manurewa East, Randwick Park and Weymouth. A high percentage of one and two-bedroom apartments has kept real estate prices in Manukau low, but the suburb is well served by transport links and retail. The remaining suburbs are dominated by older housing stock of varying quality, but first home buyers looking for a bit more land and a bit house have a higher chance of finding what they want here. Right on the city's southern border are Papakura, a new-build mecca, and Red Hill, where houses are more in line with those found in Manurewa.
Distance from CBD - more than 40km
Right on the northern most edges of the Greater Auckland region, Parakai and Wellsford are small rural communities but both are within commuting distance of Auckland (just). Wellsford prices are likely to shoot up when the improvements to the Puhoi to Wellsford transport corridor are completed and drastically cut commuting time to Auckland. Awhitu, in Franklin, and Great Barrier Island (Aotea Island), are options for first home buyers but only if remote working is an option.
