Houses in New Zealand’s most expensive suburb earned more in one day than some suburbs did all year, new figures from OneRoof show.
The average property value in Herne Bay hit a new high of $3.781 million as wealthy buyers shelled out millions of dollars for some of the country’s most prized houses.
Nationwide, the average property value rose $223,000 to just over $1m in the last 12 months, but OneRoof figures show that homeowners in more than 700 suburbs around the country enjoyed value gains above that figure.
In fact, OneRoof identified 38 residential suburbs that enjoyed lifts of more than $500,000, with waterfront Herne Bay in central Auckland leading the pack. Its $757,000 jump over the last 12 months works out to be $2073 a day - more than some homes made over the course of the year.
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The suburb that made the least amount of money was Waiwera South, a rural settlement 15 minutes’ drive from Balclutha, in Otago. Its average property value rose just $1000 – what Herne Bay homes earned in 11 hours.
Also missing out on the boom times was Owaka Valley, in Clutha, where the average property rose $2000, the equivalent of just 23 hours’ work in Herne Bay.
The average property value in both – $274,000 and $341,000 – is a fraction of what Herne Bay buyers would typically need to stump up for a deposit: $756,200.
OneRoof identified a further six suburbs where the average property value rose less than $10,000: Ruatahuna, in Whakatane; Waikoikoi, in Clutha; Tikitiki, in Gisborne; Bruce Bay, in Westland; and Mahoenui, in Waitomo.
A house on May Road, Waiwera South, Clutha, sold for $255,000 in July. House prices in the township rose $1000 in the last 12 months. Photo / Supplied
For homeowners in 15 unlucky suburbs, the last 12 months haven't been kind at all, with their average property value now lower than it was in October 2020.
The suburb that saw the biggest drop is Popotunoa, a small rural enclave in Clutha. Its average property value fell $58,000 to $328,000. Another suburb – Ashley Downs, also in Clutha – didn't see any growth at all.
One Agency real estate agent Katrina Garside, who sells all over Clutha, said that the region was still a great place to live and buy in, despite the low capital gain.
She told OneRoof she had fond memories of Waiwera South when she was growing up in the 1980s. “The Holden’s district store was still open then and we’d go down there and get an ice cream and a video. The Waiwera South School is fantastic. Our children went there back in the early 90s.”
Her most recent sale in the township was in July, when she got $255,000 for a three-bedroom 1930s wooden home on May Street.
“Homes in Waiwera South need a lot of work. A lot of them haven’t been updated and not everyone has the money to do them up,” she says, adding that homes in need of improvement can pose a problem for those looking to get finance.
“To get finance you need insurance. The other thing is down here you can’t get a tradie on time. Builders are so busy because nobody wants to leave. If nobody’s leaving, they’re all doing up their houses.”
This five-bedroom villa on Sentinel Road, in Herne Bay, Auckland, fetched just over $4.6m at auction last week. Photo / Supplied
The one upside of low house price growth in the region was that people could still afford to buy homes there, unlike many other parts of New Zealand, she said, adding that she sold multiple properties over the last 12 months to North Islanders desperate to escape lockdowns and high prices.
“We had one couple who drove all the way from Whangarei with their dog. They couldn’t believe how nice everyone was. Even the dog was happy.”
Happiness is top of mind for buyers in Herne Bay, as well. New Zealand Sotheby’s International Realty agent Pene Milne said: “You live where you live because you love it. You’re choosing the lifestyle, and a place of family and comfort and community.”
Milne put Herne Bay’s stratospheric rise down to a mix of factors. “It’s the unique double combination of being close to the city and being absolute waterfront.”
Demand for the top properties in the suburb had lifted the value of all homes in the suburb, she said.
Bayleys agent Edward Pack said that demand for homes in the suburb had risen. Last week, he sold a five-bedroom villa on Sentinel Road in the suburb for $4.63m, almost $2m above CV.
He said the buyers pursued the property because of its location. “The vendors sold it with plans, and that helped people to imagine, but they’ll all have their own ideas,” he said, adding that there was a lot more activity in the suburb since the city moved to alert level three.
“But buyers are being very considered about what they're choosing. They’re very discerning at this level.”
