Few suburbs around the world can offer beachfront homes within a five-minutes drive of the center of a major city, but this rare offering is helping Herne Bay emerge as one of New Zealand’s most desirable suburbs.
Perhaps it was the unique combination of waterfront homes and convenience that led the Sultan of Brunei to purchase 11 homes in this suburb, all of which were sold in one NZ$35 million bundle to New Zealand businessman Gary Lane in 2005.
Herne Bay is Auckland’s most expensive suburb, according to local media reports, and its rateable value increased 42% from 2014. Rateable value is the value assigned by local authorities for the purpose of determining rates, and this figure is determined in Auckland using comparable sales.
But most of its wealth is "new" money and not a legacy of past generations, local agents say.
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Boundaries
Herne Bay is defined by the Auckland Harbour shoreline to the north and west, by Jervois Road to the south and Shelly Beach Road to the east. It sits right next to the Auckland Harbour Bridge, which leads directly to the city center.
Its most expensive homes are usually found on the waterfront roads Marine Parade, Sarsfield Street and Argyle Street, although the tiny Cremorne Street is Auckland’s most expensive street, according to CoreLogic figures released in November.
Price range
Ollie Wall, partner at brokerage Graham Wall Real Estate, holds the record for the suburb’s most expensive sale. Herne Bay House, a two-level glass and metal home that sits on its own small peninsula, sold for NZ$24 million in 2017. Designed by architects Fearon Hay within a giant hollow cube, the home has a helicopter hangar, rooftop entertainment area and lift access to each level.
Wall currently has a waterfront home on the market on Marine Parade, with an asking price of NZ$15 million (US$10.8 million). The home—a bungalow that has undergone a modern renovation by Sumich Chaplin Architects—faces north with a home theater, pool, and direct water access. It opens out at the end of a discrete driveway.
"You can drag your kayak down and go for a paddle from the front yard, which is pretty extraordinary," Mr. Wall said.
Price tags of NZ$5 million to NZ$6 million (US$3.6 million to US$4.3 million) are common for houses back from the water, he said, while older two-bedroom apartments built in the 1980s and ’90s can sell for up to NZ$2 million (US$1.4 million).
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Housing stock
Most of the homes in Herne Bay are historic houses that have undergone extensive renovations.
Pene Milne, a sales associate at the Herne Bay office of Sotheby’s International Realty who has been working in the area for 16 years, said there are many Victorian and Edwardian villas built in the late 1800s and early 1900s, along with bungalow-style homes.
They have typically been extended and renovated while keeping their original shell, she said, although a number haven’t been renovated. The most expensive homes are often completely new contemporary builds, she explained.
"When you get into the high-value homes only a few would be the old vintage-era homes," Ms. Milne said. "The majority of high-value homes have been built recent years."
A well-kept historical house in Herne Bay, Auckland
Krzysztof Dydynski / Getty ImagesWhat makes it unique
Herne Bay’s principal charm is its waterfront location and convenience. The suburb is on the south side of Auckland Harbour Bridge, connecting it directly to the central business district as well as to the city’s motorway network. It also has more than its fair share of Auckland’s best restaurants.
"Herne Bay is without a doubt Auckland’s best suburb, in my eyes," Mr. Wall said. "It’s four or five minutes from the city center, it has about four beaches and half the best restaurants in the city as well. It’s completely out of the ordinary."
A lot of the waterfront homes have boat sheds dating back 100 years, he said, which is a situation that will never be repeated owing to legislative changes that prevent residents from owning the beach or the water.
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Luxury amenities
Mr. Wall said the primary schools in and near Herne Bay—Bayfield School and Ponsonby Primary School—are some of the best in Auckland. Students in Auckland usually travel away from the city center for secondary school, he said.
Top restaurants include casual dining restaurant The Halcyon and Italian restaurant Prego—something of an Auckland institution. Asian fusion restaurant Azabu is popular, as is The Butcher’s Son, which is a vegan and vegetarian restaurant. Other local gathering spots include bar The Elbow Room and fish and chip shop FishSmith.
Jervois Road is lined with boutique clothing and homewares stores.
Who lives there
While generational wealth is often found in suburbs to Auckland’s East—such as Remuera and Parnell—Herne Bay attracts young families that have more recently become wealthy, Mr. Wall said.
"Herne Bay is more likely to be the young guy who has made a lot of money in the tech industry," he said.
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Notable residents
Residents of Herne Bay include Rod Duke, a prominent Auckland businessman who has fought council over a decision to restrict how often he can land his helicopter at his Herne Bay mansion, as well as property tycoon and former cricketer Greg Loveridge. Mr. Loveridge bought his Bella Vista Road mansion from movie star Karl Urban in 2014, according to reports.
Outlook
Auckland’s property market had a slow year in 2017, which some attribute to buyer uncertainty due to the presidential election.
Annual house price growth fell to 3.3% in September 2017 according to the Reserve Bank of New Zealand after peaking at 13.8% in December 2016.
New Zealand’s upcoming "foreign buyer ban," which will stop foreigners buying houses or residential land unless they prove it will be developed to add supply to the housing market, will also impact demand in the suburb.
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However Ms. Milne said most of the buyers in Herne Bay are New Zealand residents, and she expects 2018 to be a strong year for local real estate.
"In other years, values have gone up 10% or 20% a year, but last year was one of the few years we didn’t see that," she said. "I’m not expecting 2018 to be a slow year for value increases."