Although the rent market is cooling off, rent rises continue to outpace wage growth.
Plateauing Auckland home values are leading investors to look carefully for quality suburbs and wealthy retreats rather than future growth areas.
Coastal Omaha in the far north of the Auckland region led growth in the city in the last three months with a 6.2 per cent jump in value to hit a median price of $1.74 million.
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Beach hideout Piha made the next greatest gains with a 5.2 per cent increase to $1.04m, while the North Shore's Greenhithe rose 4.4 per cent to $1.45m, according to the latest quarterly QV Property report.
Just three of the 10 suburbs with the biggest gains - Otahuhu, Manly and Surfdale - had median values below $1m.
Of these, only Otahuhu in South Auckland, with a median price of $623,600, came close to the "affordable" $650,000 benchmark that is the proposed price of a new three-bedroom KiwiBuild home.
CoreLogic NZ head of research Nick Goodall said the report likely reflected how wealthier, long-term investors were buying through the lull in price growth.
"When capital gains reduce, investors will look for other things that are attractive and that may include quality of tenants and low maintenance properties," he said.
"Those that see property as a quality investment vehicle, are going to continue to find ways to do that even when the market is changing."
It comes as average house values across the wider Auckland region slid marginally in the three months to April, dropping 0.3 per cent to $1.05m.
The Gardens in south Auckland was hit hardest as its median property price fell 2.5 per cent to $995,500.
Values in Glendowie also took a 2.3 per cent drop, down to $1.69m, followed by Chatswood, down 2.1 per cent, and Wellsford down 1.9 per cent.
Manurewa East, Beachlands, St Heliers, East Tamaki, Glen Eden and Westmere rounded out the 10 worst performing suburbs, dropping by between 1.4 per cent and 1.8 per cent in value.
Despite the price drops, 86 of the QV report's 168 suburbs recorded median prices above $1m.
It means million-dollar suburbs were now in every corner of the Supercity, apart from Papakura and Franklin in the far south.
Piha was one of the hottest property markets in Auckland over the past three months as prices jumped 5.2 per cent to $1.04m. Photo / Jason Oxenham
There the highest valued suburb was Pahurehure with a median price of $763,600.
At the top end of the market, five suburbs now have median values above $2m: Herne Bay at $2.66m, Saint Marys Bay at $2.29m, Remuera at $2.09m, Campbells Bay at $2.06m and Stanley Point at $2.01m.
OneRoof editor Owen Vaughan said the latest figures showed there was still an appetite for real estate at the upper end of the market.
"There are few suburbs in Auckland that can offer the same benefits that Herne Bay does - beautiful homes and views and close proximity to the city centre," he said.
"Suburbs like Herne Bay tend to be unaffected by the fluctuations that affect other parts of the city.
"Because supply is limited and because there isn't going to be a sudden increase in land or space, demand remains high, which in turn keeps prices high."
Bayleys head of research Ian Little, in a recent report, tipped Herne Bay to be the first Auckland suburb to hit the $3m barrier - though added that it would take a while with the recent slowing if price rises.
"Herne Bay needs its average prices to rise by more than 22 per cent for that to occur, which is unlikely to happen quickly in today's less febrile market, but as history shows, it will happen."
CoreLogic's Goodall said there were many uncertainties that made it hard to predict how much prices would rise, such as tight lending restrictions and a possible ban on foreign buyers.
Other proposed government changes may target landlords with higher taxes, while forcing them to spend more to ensure their rentals are healthy places to live and making it harder to claim rental losses as a tax write-off.
"All these things, in some form, 10 years ago you wouldn't have even thought about and they're going to have an impact on the market, but you never know for how long and how much," Goodall said.
Outside of the Supercity, meanwhile, one-million dollar suburbs remain rare.
Wellington has just three suburbs carrying the tag with median home values in Seatoun hitting $1.26m, $1.16m in Kelburn and $1.02m in Wadestown.
In the South Island, only Christchurch's Fendalton, $1.1m, and the Queenstown and Wanaka playgrounds of the rich and famous with median price tags of $1.13m and $1.14m, respectively, top the mark.
