Auckland's $1 million club

Posted by MarkL on March 7, 2015

herne-bay-bed-breakfast.jpgWhat used to be one of Auckland's most exclusive clubs got more members last week. 

Five more suburbs joined the million dollar club, where the average price for a house is $1 million or more. There are now 36 suburbs in Auckland where the average price tops the million mark. 

The New Zealand Herald reported the new suburbs were Grey Lynn, Freemans Bay, Northcote Pt, Schnapper Rock and Farm Cove. The paper also reported there were 13 more suburbs where the average house price was $900,000 and that Herne Bay was approaching $2 million for its average house price. 

CoreLogic research analyst Nick Goodall told the Herald the number of million-dollar suburbs now was "startling".

"In terms of being reachable to the average New Zealander ... there's more and more of these suburbs that people will see as unattainable."

He said on the North Shore alone almost 50 per cent of the suburbs were in the club.

"That is daunting for anyone trying to get into the market."

In 2009 the number of suburbs with a median house price of more than $1 million was just three - Herne Bay, St Marys Bay and Parnell - following the global financial crisis.

QV national spokeswoman Andrea Rush told the Herald she was not surprised five more suburbs had ticked over into the million-dollar club because values had risen by 5 per cent during the past three months alone.

"The impact for buyers is we're seeing a rise in demand for small homes and apartments in the inner city because they are a more affordable entry into the market for those wanting to live in a central Auckland location."

She said strong migration, continuing low interest rates, a shortage of housing supply and good consumer confidence meant the upward trend in values would likely continue.

"However with the listing shortage having eased over the past month and with more homes currently on the market than in the past 16 months we may see the rate of upward pressure on values start to ease."