Families looking to get into Auckland’s prestigious double grammar zone ahead of the 2024 school year will find it even harder than usual with record low sales and listings, and for the price on demand they may be better off with private schooling.
Figures from OneRoof’s data partner, Valocity, show a record low volume of sales in the third quarter of this year with just 25 properties changing hands in Remuera – and sales have been steadily declining since the first quarter of 2022.
“A lot of people thought things would pick up post-election, but I believe it’s going to take up to six months to see any real positivity fly through into more listings and sales,” said Ray White Remuera agent Steve Koerber.
The pulling power of the double grammar zone, covering Auckland Grammar School and Epsom Girls Grammar School, has not dissipated with time. Real estate agents said it could add up to $500,000 to the value of a family home, but when families weigh up the additional cost, they may also find that sending their children to a private school is more economical than paying the grammar zone premium.
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“There is always a limited number of houses and there’s generally more competition for them, but it is even tougher at present. I’ve got one family I have been dealing with for 12 months and they keep missing out,” Koerber said.
“There is a real lack of family homes in the zone available. If people have got two to four children it’s a nightmare trying to find a decent family home which makes it tougher as the school year approaches.”
A property he recently sold on Platina Street, for $4.125 million, attracted 17 registered bidders, the most he had experienced in his 27-year career selling in the area. Its huge 999sqm section is potentially subdividable and in the double grammar zone adding to its attraction, Koerber said.
He also sold a five-bedroom home on Upland Road which had six registered bidders, a sign conditions are improving, he said.
Valocity senior analyst Wayne Shum said Aucklanders have long held the belief that double grammar zone is “steroids for house prices”, and the data does show there is a premium for houses that are in the desired zone, which covers large swathes of four of the city’s highest value suburbs – Remuera, Epsom, Parnell and Mount Eden – as well the cheaper, apartment-heavy suburbs of Grafton and Newmarket.
But interest rate changes could negate the benefits of buying in the zone. If buyers have a $2m mortgage at current interest rates, he said, their yearly repayments to be in the grammar zone don’t add up and parents would be better off sending their children to a private school.
“You can get into almost any private school in New Zealand for cheaper than that and if you’ve only got one or two children, it doesn’t add up. We’ve had this conversation in my own house,” he said.
David Rainbow, of Bayleys Remuera, agrees that grammar zone has always attracted a premium.
Many parents are happy to pay the house price "premium" so their children can attend either Epsom Girls or Auckland Grammar. Photo / New Zealand Herald
Valocity senior analyst Wayne Shum: "If you’ve only got one or two children it doesn’t add up." Photo / Fiona Goodall
“The double grammar zone absolutely has impact. For example, if you live in Upland Road and you’re on the western side, which is in grammar zone, that will always hold a premium over the western side which is not,” he said.
He said listings and sales were down, but he was noticing the generational shift in the area as older residents looked to move into retirement and younger families looked to get into the zone.
“I think if your parents or grandparents have gone to the schools, the next generation wants to send their children there, but I also know there are still a lot that get in out of zone and private schools may be preferable,” said Rainbow.
He believes some vendors in the zone have been holding off listing waiting to see the election results now entering the holiday there was another traditional slowdown.
The most interesting sale in the zone recently was a dilapidated villa on Claremont Street, in Grafton, which sold at auction for $1.44m – but that was still $910,000 less than its 2021 CV.
Ex-breakfast TV host Rawdon Christie, now a Barfoot & Thompson Remuera agent, said buyers should consider the grammar zone very carefully.
Ray White Remuera agent Steve Koerber: "It’s going to take up to six months to see any real positivity fly through into more listings and sales." Photo / Fiona Goodall
This family home on Platina Street, in grammar zone, recently sold for $4.125m. Photo / Supplied
“Some buyers are looking more closely at houses on the fringes, concerned about zoning shifts. They are questioning whether it’s worth buying near the boundary because if it moves will wipe a significant sum off their capital value,” he said.
He said grammar zone can attract up to a $500,000 premium on family homes. “Where you might be looking at $3m outside, you might be looking at $3.5m inside the zone,” he said.
“We do have a lot of buyers that are trying to step up into the market but at the moment vendors have more choice and they are holding onto their homes until they perceive the market to be lifting.”
A two-bedroom apartment in MacMurray Road sold for $912,000 earlier this year as parents tried to get a foothold in the zone. In another sale at 2/50 Greenlane East, that property was only zoned for Epson Girls and didn’t attract the number of buyers agents thought it might.
“It’s another quirk of the zone. Some areas are only zoned for one of the schools. In that case the buyers only had daughters and vendors only had daughters. It’s another twist of intrigue to the grammar zone.”
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