But only 51.7 per cent of New Zealanders said they would feel comfortable if their new neighbour had a mental illness.
Chief executive of the Mental Health Foundation of New Zealand, Judi Clements, said attitudes towards mental illness were changing and people, particularly younger generations, were more accepting of mental illness.
"It is quite complicated because the question is so broad so I am not entirely surprised it is 50 per cent. But if you flip that over, 50 per cent of people would be comfortable," she said.
"If you had asked that question 20 years ago, I think you would have had a lot more people uncomfortable and we know that public attitudes have changed in New Zealand over the last 17 years."
A break down of the data by age showed young people, 15-24, were most at ease with the prospect of a new neighbour having a mental illness. Almost 60 per cent of young people interviewed said they would feel comfortable.
Fewer people in older age groups however, particularly 65 years and over, said they would feel comfortable in this situation. Only 46.8 per cent of those interviewed in this age group indicated they would feel comfortable.
The data also showed people of Asian ethnicity were the least comfortable with the prospect of having a neighbour with a mental illness. Only 39.6 per cent of those interviewed would feel comfortable.
Maori were the most accepting with 59.4 per cent indicating they would be happy in this situation.
Ms Clements said people often did not have a comprehensive understanding of mental illness which could lead to them feeling scared or uncomfortable.
"People can be influenced by some of the terminology that is used in mental health and in mental illness that they are uncomfortable with and even a bit scared of," she said.
"Some of the diagnostic labels that we know that people are more uncomfortable with because they don't know that much about it but very often it is that sort of label that makes it into scary movies."
Ms Clements said New Zealanders with metal health issues did struggle to find acceptance in society particularly when trying to find employment and housing but over time New Zealanders were becoming more understanding.
"We still have work to do," she said.
The 2014 New Zealand General Social Survey (app users click here)