New zealand could have first $2m suburb by christmas

New Zealand could have its first $2 million suburb by Christmas, according to new figures.

Auckland's luxury housing market has grown significantly this year, Property IQ revealed, with 11 suburbs now boasting an average house price of over $1 million. Westmere, Ponsonby and Devonport were the latest neighbourhoods to join the millionaire club, raising the number of luxury property suburbs to higher than it has been at any time during the last housing boom.

Property in Herne Bay topped the price list, with an average value of $1.8 million - a staggering rise of 10.5 per cent since 2011.

Westmere, meanwhile, saw the biggest increase, with house prices surging by 12.9 per cent to pass the million dollar mark. House prices in the area reached an all-time high average of $1.06m, boosted by the sale of a former Bulgarian tennis pro's home for $2.25 million, $350,000 above its council valuation of $1.9 million.

Speaking to the New Zealand Herald, one local agent explained that the market has changed a lot since he started selling property there in 1996. Since then, the area has moved on from first time buyers to attract professional couples or New Zealanders returning from overseas to invest in rental property.

"There are very few homes cross-leased or subdivided in Westmere - a lot of the homes are on sections of about 420 to 460sq m and they don't have shared driveways," he told the paper. "They're all nice cute character bungalows. The area's had a lot of renovation done over the last 20 years so it's looking very good."

If the growth continues, New Zealand's first $2 million suburb may not be far away, says Property IQ research director Jonno Ingerson.

"So far we have never had a suburb worth more than $2 million average value," he commented. "Herne Bay is the closest at nearly 1.9 million, but for the last few months values there have stabilised a little after increasing throughout 2011. If values pick up again in Herne Bay and increased at the same rate as they had been then the $2 million mark may be crossed in three or four months."