Moves to slow Auckland's housing bubble are likely to spark a prov¬incial real estate boom, property experts say.
The Reserve Bank's new loan-to-value restrictions - forcing investors buying in the Auckland Council area to have a minimum deposit of 30 per cent for ¬purchases from ¬October - mean people will turn attention to the likes of ¬Hamilton, Thames, Cambridge and Whangarei.
Prices in those areas have increased at less than a quarter of Auckland's pace over recent years and average house prices are roughly half those in Auckland.
"Provided the market remains strong, if they are stymied by the bank they will either form syndicates and keep on buying [in Auckland] in groups or they'll jump the fence and move into the provinces," property commentator Olly Newland said.
"It makes more sense dollar for dollar. There may be a big wave of investors on their way to those towns."
Newland recommended looking at areas closest to the motorways to Auckland, including Huntly, Mercer, Pokeno, Hamilton and Cambridge in the south, and areas just past ¬Wellsford, outside the Auckland boundary to the north.
Many of these areas already have an influx of Aucklanders.
Census figures from 2013 showed Waikato had the greatest number of residents who had been in Auckland in 2008, followed by Wellington and Christchurch.
Tauranga came in fourth place, followed by Whangarei.
Auckland University senior lecturer in economics Ryan Greenaway-¬McGrevy said an increased interest for property outside Auckland would probably affect prices.
"Generally, you'd expect prices elsewhere to pick up as Auckland is clamped down on."
NZIER economist Shamubeel ¬Eaqub agreed. "Relatively speaking, it's pushing more money into the provinces."
He said if the Reserve Bank expected its measures to take 2-4 per cent out of price inflation in Auckland, it was reasonable to expect regional centres to have a matching boost in house prices.
That could mean year-on-year growth of about 8 per cent in ¬Hamilton, 9 per cent in Tauranga and 2 per cent in Whangarei.
But he said tenants would not need to worry. Although investors might move in from Auckland, they would not be able to bring Auckland rents with them.
"Rents tend to be very locally set, and are linked to local incomes and conditions," Eaqub said.
Forty-seven houses in one day
By Kirsty Wynn
Dramatic music drowns out nervous chatter as house-hunting hopefuls pick a spot in the Barfoot & Thompson midweek auction room.
It's Wednesday morning and the Shortland St venue is so packed buyers overflow into the foyer.
Sales statistics and reassuring video grabs of stalwarts Garth Barfoot and Peter Thompson flash up on the big screen. Auctioneer Murray Smith takes centre stage and commands attention of the crowd. He has "three coffees" under his belt and kicks off with a stunning four-bedroom home in Ellerslie.
It's one of 47 properties up for grabs at the auction house today. This week alone, 153 houses will be auctioned and more will be offered on-site at the weekend.
If they don't sell, you can't blame Smith. He has 25 years' experience and sells each house as if it was his own. He has an impressive array of tactics, including rattling off bids in Mandarin for the large Chinese-speaking contingent and referencing famous commentators for the sports buffs.
On this day, 25 properties sell and 22 are passed in - eight with no bids, although buyers are lining up to enter into negotiations.
There are tears of disappointment, sighs of relief, whoops and claps of delight.
Peter Thompson says three auction days each week is a sign of the heated market. But, he says, at some stage that market will self-correct - something purchasers and vendors need to keep in mind.
A run-down two-bedroom Mt Wellington cottage comes on the auction block. It's where Thompson says first-home buyers should be looking. It's up and coming, close to shopping centres and transport. Bids start at $500,000 with three serious groups.
With their top price in mind, Liz Clayton and husband Talo Vailahi bid with confidence.
One couple bow out at $615,000, muttering about the work needed. Liz goes head-to-head with the other pair and has them at $640,000.
But the process hasn't been easy for the couple, who rented in Otahuhu to scrimp and save the 20 per cent deposit.
Numbers for the afternoon auctions are so high they are split into two rooms. A woman leaves in tears and another couple notch up their 10th unsuccessful auction.
The couple, under-bidders for an Onehunga bungalow, were disappointed but not heartbroken.
"We have been to about 60 open homes in the past four months and spend all day Saturdays looking but we will find something eventually," the woman says.