"Havelock North is seeing the same boom as some of the most in-demand suburbs in Auckland and probably New Zealand," he said.
"It's being driven by cheap money and people's desire to get in now."
The $330,000 increase has been influenced by low interest rates fuelling people's ability to purchase more or pay higher prices for properties, according to Vaughan.
OneRoof editor Owen Vaughan said prices in Havelock North are being driven by "cheap money". Photo / Warren Buckland
In the last six months to May 10 there were 127 settled sales in the area, the most expensive of those sales was a property that sold for $4.45m.
The property on Black Barn Rd sold in January, according to Homes.co.nz it is now worth $4.83m.
In that time almost $140m changed hands in Havelock North.
Sotheby's International Realty central region managing director Fraser Holland said 70 per cent of homes sold in Havelock North in the last quarter went for over $1m.
"The million dollar plus market is strong across Hawke's Bay," he said.
Bluff Hill's median value property price also tipped over the million dollar mark this May at $1.05m.
The median average this time last year on Bluff Hill was $770,000, a $300,000 dollar jump in 12 months.
Over the past six months, 29 properties have been sold there.
"With the national property market strong, importantly Auckland, we continue to work with as many out of region buyers at the top end, as those living locally," Holland said.
The OneRoof editor said places in Hawke's Bay are still seen as "relatively" affordable for the rest of the country.
But, Vaughan added, places that have ample amenities and good schools, like Havelock North, are in great demand which is "creating upward pressure in prices."
Other million dollar suburbs include Maraekakaho, Pakowhai, Puketapu, Te Awanga and Waimarama.
However, in the last six months these places have all had less than 10 properties sold.
Ahuriri is a million dollar suburb too, the median average there is now $1.01m, but only 12 properties have been placed on the market and sold there in the last half-year to May 10.
Ray White Hawke's Bay managing director Elanor McDonald said the region's market is in short supply in every price bracket, which is adding to the big increases in house prices.
"We don't have enough houses for our population and are a lovely place to live," she added.
