Would you pay an extra $1m for the right postcode?

9:13 am today

Susan Edmunds, Money Correspondent

Many Auckland areas have a difference of more than $1m in median value across the border between them. File photo. Photo: nataliacatalina/123RF

If you are hankering after an exclusive suburb, but your budget can not quite stretch to it, you might be able to get a good deal on the area next door.

Property data firm Cotality has produced research showing the suburbs with the biggest median difference in house price from their neighbouring suburbs.

The data only covers houses, not apartments or townhouses.

It found that Mount Wellington and Remuera had the biggest difference. Remuera had a median value of $2.358 million, and Mt Wellington $1.059m - creating a difference of $1.298m in median value across the small shared border between the two.

Epsom and Three Kings were next, with a difference of $1.045m. Mt Eden and Mt Roskill followed, at $1.009m.

Ben Lomond and Sunshine Bay, Queenstown were in fourth place, with a median difference of $1 million.

St Heliers and Glen Innes, back in Auckland again, took the fifth spot with a difference of just over $970,000.

Head of research Nick Goodall said there was a known division in Auckland's eastern bays. "If you're in those coastal suburbs or slightly inland that's an expected difference.

"St Heliers is going to have lots of amazing coastal properties and Glen Innes has none of them. Anywhere where a suburb is coastal and adjoining a suburb that is not will have differences."

Goodall said he only used each suburb once. If he had counted Remuera multiple times, Remuera and Ellerslie would be the second-biggest difference, with a jump of $1.057m.

He said there would be less difference between a non-coastal part of a mostly coastal suburb and a neighbouring area.

"If you look at the inner part of St Heliers, I would say property values there are quite similar to Glen Innes. The ones on the coast will be dragging up the median value."

Rukuhia and Temple View were another notable addition to the list, with a $913,018 difference. Although they have a shared border, they are in two different territorial authorities - Waipa and Hamilton City.

Goodall said buyers were sometimes driven by suburbs. "We talk about them as being vanity suburbs. If you live on a border of, say, Khandallah, you might say you live in Khandallah and if you're selling you might put Khandallah on it - now the official address won't be Khandallah but the fact it has it in the listing might attract more people than if it was the suburb next to it.

"If you're on the border with a suburb that's known to be more expensive and has a good reputation you take advantage of that. Some of these that are genuinely adjacent, if you're at the border you might tell people it's a different suburb than it actually is."

Wellington salesperson Mike Robbers said the majority of buyers were probably not "laser focussed" on one suburb.

"Especially first-home buyers - they tend to just want a house that ticks enough boxes that's within their price range. But perhaps 30 percent of buyers only want one or two suburbs - for example those who work at the hospital will often only consider Newtown or Mount Cook, whereas Weta staff will typically only be looking in Miramar or Seatoun. We also find a certain percentage of buyers will point blank refuse to consider certain suburbs, for various reasons."

Infometrics chief executive Brad Olsen said there was a combination of demand pricing, in terms of people wanting to pay more for certain areas, and the features of an area.

"Some areas have more of a focus around school zones, the likes of Epsom and Remuera I would think would be more about the school zones.

Photo: Supplied

"You've got other areas - parts of Glen Innes for example relative to St Heliers - St Heliers has got some pretty nice, pretty big houses and a lot more character sort of stuff. Glen Innes has got a bit more building that been going on in recent times by the looks of it.

"Sometimes you've got straight up amenity. Who's got really nice views, where are the views and the opportunities."

Sometimes there could be components of what the land was being used for, he said. "The likes of Rukuhia versus Temple View, there's various lifestyle blocks that are going to be generally more expensive. That's near the airport… the likes of Temple View is a lot more focused on a certain specific set of houses for a faith-based community out there.

It depends what you're wanting and what you might get in that area, what services are around, how much new development might be there, how much heritage protection, what views and other amenities… that does have a pretty big influence on average prices."