All sources have been thoroughly verified for credibility. Furthermore, a local real estate expert has reviewed and approved the final article.
Yes, the analysis of Auckland's property market is included in our pack
Considering buying a nice property in Auckland? You're not alone!
Auckland's natural beauty and cosmopolitan vibe enthrall many, making them dream of owning a modern waterfront penthouse or a charming suburban home in New Zealand's city.
Still, would it be a smart investment? Are property prices increasing in Auckland? What is the price per sqm? Should I buy property in the CBD or Ponsonby? And the taxes? Which place will give me the best yields?
We've got it all sorted. No worries.
The BambooRoutes team knows this market inside and out. Actually, we've organized all our findings in a pack. Get it now.
In this article, we're happy to share useful information with you.
How is the real estate market in Auckland?
What's the current state of the property market? Data will give us the insights we need.
Types of properties
In Auckland, there are various types of properties available for sale, catering to different preferences and needs.
These include single-family homes, apartments, townhouses, and condominiums.
Single-family homes offer standalone living with a yard, while apartments provide a more compact and communal living experience. Townhouses blend aspects of both, often with shared walls and small yards. Condominiums offer ownership of a specific unit within a larger complex and usually include shared amenities.
So, whether you're looking for a spacious home, a cozy apartment, a convenient townhouse, or a low-maintenance condo, Auckland's real estate market has options to suit different lifestyles.
Buying vs Renting
(If you plan to use it yourself and not as a rental)
If Auckland is your home or future destination, you may be considering whether to buy or rent a property in this picturesque city in New Zealand.
Obviously, it's better to buy if you are looking for an asset that can increase in value and provide potential tax benefits.
One data can help us make a decision - the price-to-rent ratio. This number gives you an idea of how long it will take to break even on the property's purchase using rental income.
According to Numbeo, the property price-to-rent ratio in Auckland is around 30.26, which is significantly above the world average.
It indicates that buying a property is more expensive in the short term compared to renting. However, buying can still be a viable option if you plan to live in Auckland for an extended period or if you think property values will increase.
Property prices in Auckland
On average, according to the last data from Quotable Value, purchasing a property in Auckland will cost you around $8,700 per square meter.
There are significant differences, clearly. A waterfront house in Auckland might have a higher price per square meter than a townhouse in the suburbs. We actually give you a more detailed breakdown in our pack for buying property in Auckland and in New Zealand.
To put things in perspective, it is similar to the prices you can find in a city like Oslo.
Also, housing prices in Auckland are 20% cheaper than in Sydney.
The most expensive neighbourhoods in Auckland are probably Herne Bay, Parnell, St Marys Bay, Remuera, and Kohimarama. The cheapest areas in Auckland are probably Otara, Papatoetoe, Manurewa, and Mangere.
Trends
First and foremost, we have to acknowledge that New Zealand is, today, an exceptionally stable country. The last Fragile State Index that has been reported for this place is 17.5.
It is something to have in mind when wondering whether it's a good investment to buy a property in Auckland.
Also, according to the International Monetary Fund (IMF), New Zealand's economy is expected to soar by 8% in the coming 5 years, resulting in an average GDP growth rate of 1.6%.
If you intend to invest in real estate in Auckland it's a good thing because an expanding economy usually means people earn more, so they can buy property for themselves or as an investment, causing property demand (and then prices) to increase.
Also, in New Zealand, the average GDP per capita has changed by 4.6% over the last 5 years. Though not substantial, there is still a positive trend of growth.
These are cues signaling that property prices in Auckland might go up in 2024 and during the coming years.
Looking for more updated data? We've done a big-picture study to find out if it's a good idea to purchase property in New Zealand right now.
Buying property in Auckland
Buying real estate in Auckland can be difficult due to the lack of reliable and up-to-date information available to buyers. That's why we have created the pack to buy property in Auckland and in New Zealand.
Buying process
In our pack, we've explained the entire process of buying properties in a detailed way. We've pointed out the mistakes to steer clear of, shared tips for finding properties that give you the best returns, and provided information about taxes and necessary documents.
Now, we're giving you a simplified version of the buying process.
This is the step-by-step process to purchase a property in Auckland:
- Determine your budget and property preferences considering Auckland's property market trends.
- Obtain a pre-approval for a mortgage from a local bank or lender.
- Engage a licensed Auckland real estate agent or use popular property listing websites.
- Attend property viewings and focus on areas with good infrastructure and amenities.
- Make a written offer using the Auckland District Law Society Sale and Purchase Agreement form.
- Negotiate terms, such as price and settlement date, with the seller or their agent.
- Conduct due diligence, including obtaining a LIM (Land Information Memorandum) report from the Auckland Council.
- Organize a building inspection and obtain any other necessary reports.
- Secure your financing and confirm the settlement date with your lawyer.
- Sign the Sale and Purchase Agreement, and pay the deposit into the agent's trust account.
- Review the title and other legal documents with your lawyer.
- On settlement day, transfer the remaining funds to the seller's lawyer, complete the property transfer process, and register the property under your name at Land Information New Zealand (LINZ).
Also, if you're not from the country, you might want to check our article on how to buy property as a foreigner in New Zealand.
Make a profitable investment in Auckland
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Where to find a property
Discover properties in Auckland using these websites.
- Realestate.co.nz - Offers New Zealand real estate listings for sale or rent, along with valuation services and news.
- OneRoof - A property search platform in New Zealand providing listings, property estimates, news, and tools for buyers and sellers.
- Harcourts - A New Zealand real estate company offering residential and commercial property services, along with news and resources.
- Rightmove - Specializes in helping people buy, rent, and invest in real estate in New Zealand.
- Trademe - A leading online marketplace in New Zealand for buying, renting, selling properties, and other services.
Also, know that we have included contacts of real estate agencies, property lawyers, moving companies, expats communities and more in our pack for buying property in New Zealand.
Properties & Budget
As mentioned before, the average price per sqm in Auckland is $8,700. A 1-bedroom property with 60 square meters of space would cost approximately $522,000, and a 2-bedroom with 85 square meters of space would cost approximately $740,000.
However, as you can guess, property prices will differ based on the attributes of the property and its specific location.
Expect higher property prices in the premium areas of Auckland. An apartment in Ponsonby might cost around $1,000,000, while an apartment in Devonport could be priced at $920,000.
Of course, some areas are cheaper. You may find a residence in Mangere for $860,000, or a residence in Otara priced only at $550,000.
We give a more detailed breakdown in our full pack for buying property in New Zealand.
Risks and pitfalls
Here are the main pitfalls when buying a property in Auckland, New Zealand:
- Foreign buyer restrictions: Non-resident buyers may face limitations on property acquisition.
- Maori land issues: Some properties may have Maori customary rights or restrictions, affecting ownership.
- KiwiBuild properties: Eligibility criteria and resale restrictions can impact investment opportunities.
- Coastal erosion and flooding: Properties near the coast may be prone to erosion and flood risks.
- Heritage building restrictions: Historic properties may have stringent preservation guidelines, limiting modifications.
- Land covenants: Some areas have strict rules on property use, design, and construction.
- Meth contamination: Ensuring a property is free from methamphetamine contamination is vital for health and safety.
- Volcanic cone restrictions: Properties located near volcanic cones have development restrictions due to geological hazards.
We don't want this to happen to you, so we have included a full checklist for your property investment in our pack of documents. Avoid these mistakes and save a lot of money.
Everything you need to know is included in our New Zealand Property Pack
Living in Auckland
Living in Auckland is a great experience, with its vibrant culture, stunning scenery, and diverse range of activities, making it an ideal place to buy property.
Cost of living
The cost of living in Auckland is generally considered to be high compared to other cities in New Zealand. The city has a high cost of housing, food, and transportation, but there are still ways to find affordable options.
Here are some examples to better understand the cost of living in Auckland, New Zealand:
- A flat white coffee at a local café: $4-$6.
- Rent for a one-bedroom apartment in the trendy Ponsonby neighborhood: $1,800-$2,800 per month.
- Monthly AT HOP public transportation pass for zones 1-4: $120-$180.
- A bottle of L&P (Lemon & Paeroa), a popular New Zealand soft drink: $2-$3.
- Utilities (electricity, heating, cooling) for an 85m² apartment in Auckland: $150-$250.
- A classic Kiwi pie at a bakery: $4-$6.
- Entrance fee to the Auckland Museum, showcasing New Zealand's history: $15-$20.
- Health insurance coverage for a family of four: $300-$500 per month.
Neighbourhoods
Since we like to present information in a clear and reader-friendly manner, we've created a summary table outlining the different neighborhoods in Auckland. For yields, prices and rents, check our property pack.
| Neighborhood | Description | Strengths | Weaknesses |
|---|---|---|---|
Ponsonby | Ponsonby is a trendy and vibrant neighborhood known for its lively atmosphere, excellent dining options, and boutique shopping. | Great nightlife, cultural events, and proximity to the city center. | Can be expensive, limited parking options. |
Mt Eden | Mt Eden is a picturesque suburb with a dormant volcano at its center, offering stunning views of the city and peaceful surroundings. | Scenic beauty, recreational opportunities, and friendly community. | Higher property prices, limited public transport. |
Glenfield | Glenfield is a family-friendly neighborhood with good schools, parks, and shopping centers, making it an ideal place for raising kids. | Excellent amenities, affordable housing options. | Lack of nightlife and entertainment options. |
Devonport | Devonport is a historic seaside suburb with charming Victorian architecture, beautiful beaches, and a strong sense of community. | Stunning waterfront, artistic and cultural events. | Can be pricey, limited public transport. |
Takapuna | Takapuna is a bustling neighborhood with a lively beach, popular cafes, and a variety of recreational activities. | Beautiful beach, great shopping and dining options. | Heavy traffic, high housing costs. |
Grey Lynn is a diverse and trendy suburb known for its community spirit, parks, and vibrant cafe culture. | Eclectic atmosphere, proximity to the city. | Parking challenges, limited open spaces. | |
Herne Bay | Herne Bay is an upscale neighborhood with luxurious homes, picturesque streets, and stunning views of the harbor. | Exclusive and upscale, beautiful waterfront properties. | High property prices, limited public transport. |
Manukau | Manukau is a culturally diverse area with a large shopping center, good transport links, and proximity to the airport. | Excellent shopping, cultural diversity. | Traffic congestion, some areas may lack amenities. |
Papatoetoe | Papatoetoe is a multicultural neighborhood with a strong sense of community, affordable housing options, and proximity to the airport. | Close to the airport, ethnically diverse. | Some areas may lack amenities, traffic during peak hours. |
Life in Auckland
Auckland is the largest and most populous city in New Zealand, and is a major economic hub. It is home to a diverse and vibrant economy, with strong industries in tourism, finance, and technology.
As per the IMF's data, Auckland's GDP accounts for nearly 31% of New Zealand's GDP. It's nice because people in cities with strong economies usually get better services, which makes life better.
What expats usually like the most in Auckland is its vibrant culture, with numerous festivals, events, and activities to enjoy year-round, as well as its stunning natural landscapes, from the Waitakere Ranges to the Hauraki Gulf.
However, the crime rate index of Auckland, which is around 49, could be better. It's something to consider if you want to live there. Examples of crimes in Auckland include theft, burglary, assault, robbery, and drug-related offenses, which are primarily committed by the local population and do not significantly affect the expat population.
A good point for a property investor - Auckland has an extensive mass rapid transit system consisting of buses, trains, ferries and light rail.
Access to healthcare in Auckland is excellent, with a Healthcare Index of 70. A strong healthcare setup always reflects positively on real estate.
Finally, it is worth noting that the University of Auckland ranks among the top 150 universities in the world.
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Renting out in Auckland
This section is for you if you want to buy property solely for renting out and earning income.
Long-term
Tenant Profiles in Auckland
According to the data reported by Wikipedia, the home ownership rate in New Zealand is 65%, which is average.
It means that, if you decide to buy and rent out in Auckland, there will be a good number of people who can become your potential tenants.
If you decide to buy and rent out to long-term tenants, you should target young professionals, families, and students in Auckland. Older people and retirees may also be interested in renting in the area.
Here is a little summary table we've made for you.
| Property type and area | Profiles of potential tenants | What they are looking for | Expected monthly rent in $ |
|---|---|---|---|
Apartment in Auckland CBD | Professionals, students | City center, access to amenities | $1,500 - $2,500 |
House in Ponsonby | Families, young professionals | Trendy neighborhood, entertainment | $2,500 - $4,000 |
Apartment in Newmarket | Students, working individuals | Near universities, shopping | $1,200 - $2,000 |
Townhouse in Mount Eden | Families, professionals | Residential area, parks | $2,000 - $3,500 |
Apartment in Mission Bay | Beach lovers, retirees | Waterfront living, views | $1,800 - $3,000 |
House in North Shore | Families, expats | Suburban lifestyle, schools | $2,500 - $4,500 |
Apartment in Albany | Students, professionals | Near universities, shopping | $1,200 - $2,000 |
Rental yields
As of today, rental yields in Auckland are floating around 2 or 3%. It's low. A good rental yield is typically considered to be around 7% or higher (you might know it already).
In Auckland, properties in suburban areas with lower median house prices tend to be the most attractive for rental yields, as they offer a higher return on investment compared to more expensive areas. Additionally, properties close to amenities such as public transport, schools, shops, and parks are also desirable, as they tend to attract tenants with higher incomes.
For further explanation and a more detailed breakdown, you can check the reports and analyses we have made.
Finally, be aware that rental incomes in Auckland are taxed at 14%, which is not much.
Short-term
You could also decide to rent short-term to corporate travelers, tourists, and students looking to experience Auckland's vibrant culture and attractions. Additionally, you could rent to temporary workers, such as those in the film industry, who are in the city for a short period of time.
If you decide to go with that option, look for properties in the city center, such as Ponsonby and Parnell, or in the popular beachside suburbs like Mission Bay and Herne Bay.
Currently, there are approximately 6,000 active Airbnb listings in Auckland, reflecting a highly dynamic and bustling short-term rental market. The average daily rate stands around $148, which is quite high.
You have the opportunity to generate a nice additional income stream then. Based on feedback from online testimonials and data analytics platforms such as AirDNA, Guesty, and Inside Airbnb, people who offer short-term rentals in Auckland can make around $2100 per month. Also, the average occupancy rate is estimated at 76%.
Is it worth buying real estate in Auckland then?
Certainly, when it comes to buying a property in Auckland, it boils down to two key factors: your long-term intentions and your financial capability.
If you're planning to settle down in Auckland for the foreseeable future and view property ownership as a home rather than a quick investment, it can make sense. Auckland offers a stunning lifestyle, a stable economy, and the potential for property values to rise over time.
However, if you're only planning a short-term stay or have a limited budget, buying property in Auckland might not be the wisest choice. The city's property market is notorious for its high prices, and the transaction costs associated with buying and selling can be substantial. Moreover, Auckland's rental yields are relatively low compared to other regions, which means that the return on your investment through rental income might not be as impressive as you'd hope for.
Additionally, it's crucial to consider potential risks and restrictions. Auckland's property market has its own set of challenges, including foreign buyer restrictions, Maori land rights issues, and various property-specific risks such as coastal erosion and heritage building restrictions. These factors can complicate the property buying process and add uncertainty to your investment.
In summary, while Auckland has its allure as a property investment destination, it's not a one-size-fits-all proposition. Your decision to buy should align with your long-term goals, financial capacity, and risk tolerance. Careful consideration, thorough research, and possibly consultation with local experts are essential steps before diving into Auckland's property market.
Make sure you understand the real estate market in Auckland
Don't rush into buying the wrong property in New Zealand. Sit, relax and read our guide to avoid costly mistakes and make the best investment possible.
The content provided here is for informational purposes only and does not imply endorsement or advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the content and analyses presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.