A decision to downsize from house to caravan has seen a Rotorua woman sell her home for a tidy profit and become mortgage-free.

Nikki Blatch recently sold the two-bedroom Clinkard Ave house she bought in December 2016.

Blatch said she was pleased but very surprised by what it sold for.

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"I bought it for $185,000, and spent just over $15,000 on it then sold it for $272,000," she said.

"It had all been done up and I really didn't know what price I was going to get."

Blatch had spent time and money making the lounge, kitchen and dining room open plan.

She decided to sell because she wanted a different lifestyle and wanted to live mortgage-free, so following the sale she bought a caravan and now lives on a lot in Ngongotahā.

Blatch was glad Rotorua's house prices were catching up with other cities, but it also made her sad for future buyers.

"It's gone crazy. I really didn't think my kids would be able to get a place but they have, for a lot higher though," she said.

"It's a shame this has happened. It's good the rise benefits sellers, but for the people who are wanting to buy it makes it hard."