Hairini was Tauranga's top-performing suburb for rises in property values in the past year, according to new data.
The latest OneRoof/Valocity figures show median house prices in the area grew 15.9 per cent from December 2017 to December 2018 - the highest increase among Tauranga suburbs.
That was followed by Tauranga central, with a 15.5 per cent rise in median house prices, and an 11.2 per cent jump in median house prices in Ohauiti.
OneRoof editor Owen Vaughan said affordability will be driving the growth in many of Tauranga's top-performing suburbs.
However, he said location and proximity to city drawcards, such as the beachfront, will be a factor in the strong values shown in other areas.
Tauranga's median sales price in the lead-up to the Christmas holiday period was $635,000 - up 1.4 per cent on the same period the year before.
The bulk of sales activity in November and December took place in the sub-$1 million bracket, with properties that sold for between $750,000 and $1m accounting for 27.4 per cent of sales.
Properties that sold for between $600,000 and $750,000 accounted for 26.4 per cent of sales.
First-home buyers in Tauranga still accounted for the bulk of new mortgage registrations - 28 per cent - up from 25 per cent on the year before.
Vaughan said the increase in new mortgage registrations suggested that although buyers in Tauranga faced the same affordability challenges as those in Auckland, it hadn't dented their activity in the market.
Investors' share of new mortgage activity has dropped, which Vaughan said suggested people were moving on to cheaper markets outside of Tauranga, where returns were higher.
The median house price across the region had dropped 2.9 per cent year-on-year to $680,000.
Simon Anderson, chief executive of Realty Group, which operates Eves and Bayleys, said there had been a lot of activity in the top end of the market.
Anderson said people seeing value in the Hairini area was driving demand for properties.
There were a lot of transactions in the $750,000 to $1m market because there were a lot of listings within that budget, he said, and buyers with that type of budget were most likely second-home buyers.
Valocity director of valuation innovation James Wilson said the drivers supporting value growth in New Zealand were still evident.
"Namely a shortage of good-quality housing stock on the market and demand fuelled by a historically low-interest-rate environment."
Hairini residents Bruce and Maureen Cronin have lived in the area for 27 years after moving from Hamilton.
The Cronins bought a home on Taumata Pl in 1992 before buying the house next door in 2004.
The pair renovated their new home before moving in in April 2005.
"It was a little red brick cottage and we modified it. We totally rebuilt it," Cronin said.
The long-time resident was unsure what the couple had paid for either home on Taumata Pl, nor what they had spent on renovations.
"We knew we had overcapitalised but we wanted to stay here indefinitely. We knew the market would catch up eventually."
Cronin said the pair bought on Taumata Pl for the view and felt lucky to have secured their home, which looks over the Hairini Bridge and out towards Mount Maunganui.
"When you come to a place like Tauranga you look around and think everyone has fantastic views," he said.
"But when you try to buy a place that has fantastic views you realise there is not that many."
However, Hairini had changed since the pair moved there 27 years ago and Cronin said the biggest difference was the traffic.
"It takes a good 20 to 25 minutes to get into town now, which just shows how much the place has grown."