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From the air, Auckland’s suburbs may look similar, but from the ground, the difference can be hundreds of thousands of dollars. File photo.
photo: RNZ/Diego Opatowski
Would you pay more for life in Khandallah than in Ngaio? Or for life in St Heliers than in Glen Innes?
Corelogic data shows buyers do just that, and the premium paid for properties in popular suburbs can be hundreds of thousands of dollars more than in surrounding areas.
Corelogic head of research Nick Goodall looked at the average price of a three-bedroom home in neighbouring suburbs.
He found that Epsom had a median house price of $1.92 million, while next door Greenlane had a median house price of $1.52 million. St Heliers had a median house price of $1.7 million, while Glen Innes had a median house price of $1.12 million. Mt Eden had a median house price of $1.91 million, while Mt Roskill had a median house price of $1.07 million; Remuera had a median house price of $1.8 million, while Meadowbank had a median house price of $1.62 million; Ponsonby had a median house price of $2.4 million, while Grey Lynn had a median house price of $2.04 million.
In Wellington, Khandallah’s average salary was $1.07m, while Ngaio’s average salary was $965k.
“Now, I’m not saying the only difference between the two suburbs is the name of the suburb, but it could be a factor influencing the value.”
Other factors may include school districts, the availability of views, amenities and transportation, and the age and quality of the property, he said.
He cites the example of Auckland’s Apirana Ave, once considered the epitome of suburban divide.
Property records list property 2 as St Heliers with an assessed value of $1.59m, while property 4 is Glen Innes with an assessed value of $1.37m, according to Homes.co.nz. In this case, property 2 is about 30sq m larger and has a larger block of land.
People who live near neighboring suburbs sometimes claim that they live there for the extra “prestige” they get.
“Compared to Strathmore, Miramar has blurred boundaries and people are quick to claim to be in one suburb or another. There’s an element of vanity suburbia here – if somewhere does have a better name, of course you’d claim it.”
Real estate coach Andrew Duncan agrees that school zones are a major reason for price differences between neighborhoods, especially when they appeal to young families.
But he said housing style was also an important factor.
“St Heliers versus Glen Innes is a good example – my in-laws live in St Heliers so I know the area pretty well.
“The two suburbs are very similar in terms of amenities, distance to town and transport… but the architecture of Glen Innes is very different – more small three-bedroom homes from the 1960s, of similar design, set on larger blocks which are slowly being developed into townhouses, whereas St Helens has a lot of large, architecturally designed family homes with pools, large gardens, double garages…”
He said there would be some value purely related to the property’s address.
“If all things are equal – amenities, transport, school zones, house size, people will pay more, sometimes a lot more, to live in a suburb with a higher value and a higher average property value, largely because they want to benefit from increased capital gains over time.”
He said awareness was also driving the suburb’s popularity.
“Is the suburb well known by people from different areas? Which suburb do they look up first online?”
He said suburbs that were larger or close to motorway exits were more popular based on online searches.
“If the buyer is moving from another city or the other side of town, they need to take some time to learn about all the smaller suburbs within their target area. If the property is in a lesser-known suburb outside of the surrounding area, it would be best for the owner to invest more in marketing and hire a salesperson with a large database to ensure all buyers know their property is for sale.”
Trade Me customer director Gavin Lloyd said demand was being driven by people wanting to live in prestigious areas.
He said Epsom’s dual grammar area was a big drawcard for buyers.
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