- Research shows West Coast property values rose $192,000 in five years, nearly matching Auckland’s $211,000 gain.
- West Coast homes required a typical deposit of $56,000 in 2019, compared to Auckland’s $215,000.
- Lower-priced regions are seeing stronger gains as buyers seek affordable options outside main centres.
Should first-home buyers have targeted Auckland or West Coast before Covid struck? New research suggests buyers who opted for the country’s cheapest region in 2019 may have ended up with the better deal.
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Figures from the OneRoof-Valocity House Value Index show West Coast’s average property value jumped $192,000 in the last five years. That’s close to Auckland’s five-year tally of $211,000 – which means those who bought in West Coast five years ago have enjoyed almost the same value gain as Auckland buyers but for less than a third of the outlay.
Valocity senior research analyst Wayne Shum said the value gains made in both areas over the last five years were similar, but noted that the typical deposit buyers would have required for an Auckland home in 2019 was $215,000, compared to the $56,000 needed for a West Coast home.
The interest charged on an Auckland mortgage over the same period would have been much higher than the cost of a West Coast mortgage.
West Coast’s average property value has risen steadily in the last five years, while Auckland’s rose sharply immediately after Covid, then plunged, wiping out much of the gains Auckland homeowners enjoyed during the boom.
Shum said property values in lower-priced regions and districts had benefitted from first-home buyers and investors looking for more affordable options outside the main centres.
“This happens within cities as well. For example, some of the cheaper suburbs in Auckland actually enjoyed stronger gains than some of the more expensive suburbs, where the buyer pool is smaller.”
West Coast agents told OneRoof that houses in the area were cheap compared to the rest of the country.
Dee Dee Daly, of Greg Daly Real Estate, said West Coast had seen an influx of buyers from the region. That had pushed up prices, but not enough to curb demand.
Daly said there was decent activity from a wide range of buyers, including out-of-towners, first-home buyers, and locals upsizing and downsizing.
8 Robinson Street, in Blaketown, Greymouth, is inviting buyer enquiry over $495,000. Photo / Supplied
A three-bedroom home at 27 Pitt Street, Runanga, in Greymouth, can be bought for $370,000. Photo / Supplied
She said that houses in Greymouth, in her patch, would have been worth just over $200,000 five years ago but were now hitting the high $400,000s.
“People are buying them and locals are buying them as well because that’s just the way the prices are going,” she said.
She’s just listed a three-bedroom home at 8 Robinson Street, in Blaketown, in the town, which is inviting buyer enquiry over $495,000. It has already received one offer from a buyer, with two other parties expressing serious interest.
“If you were selling that in Auckland, it would be $950,000. So it’s still cheaper than what people can get anywhere else for the quality of house.”
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Property Brokers West Coast regional manager Rob Maskill said even though there had been a spike in house values, entry-level properties could still be picked up in the mid-$200,000s and early $300,000s. “You can still get some good value here.”
Maskill is selling a three-bedroom, one-bathroom home on a 1012sqm section at 27 Pitt Street in Runanga, in Greymouth, for $370,000, while a three-bedroom home at 97 Marsden Road, in Greymouth, has an asking price of $325,000.
Improvements in the region’s economy have led to increased demand for houses and rental properties. Official figures show employment growth of 1.6% in the year ending September 2024, higher than the national rate of 1.2%.
Maskill was also hopeful the increase in mining in the area would result in even more demand. “We don’t need a lot to change our market over here. If we get 50 to 100 people buying over here that changes the dynamics here quite quickly,” he said. “If you have more buyers and investors looking, obviously the price will go up.”
Valocity senior research analyst Wayne Shum says lower value-based areas are making stronger gains than higher value areas. Photo / Supplied
Harcourts agent Harsh Kathuria, who sells in South Auckland, said almost every second investor he spoke to at the moment was putting their money in real estate outside of Auckland.
“I think the risk factor is a little lower in terms of the investment and the growth factor is significantly higher, whereas I think in Auckland people are a little bit scared of investing in such a volatile market.”
Auckland’s average property value hit a high of $1.57m at the end of 2021 – a bump of more than $500,000 – but has dropped more than 18% in the three years since then, although values have risen slightly in the last three months.
Kathuria said he wouldn’t be surprised if value growth in Auckland slowed because of the large number of people leaving the country, and the high number of properties on the market.
“There are tough times ahead for Auckland.”
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