With a big student population, Dunedin is well known as the city of scarfies. But with beautiful beaches, a rich heritage and Victorian architecture, it has so much more to offer. Bayleys Dunedin Managing Director Chris Maclean was born and bred in the area, and describes the city as a vibrant big village.

“It's large enough to have events going on, but small enough that it doesn't feel hurried or rushed.”

“It's easy to get to most places - with our equivalent of a traffic jam only occurring if you miss a couple of lights. I think that's part of the appeal for people who come down here for the lifestyle.”

Maclean says a large amount of coastline provides the perfect backdrop for beach lovers, and the perfect playground for those who enjoy the outdoors.

“For surfing, there's nowhere where you can't go to ride a good break. We have a real lifestyle opportunity here, and within 10 minutes you can be at a beach, no matter where you live.”

There’s also fishing, boating and skiing for those keen to do a bit of a road trip.

“Within a three-hour drive, you can be on the ski fields or walking your dogs in the hills and treks. So we've got a little bit of everything.”

“Personally, I didn't realise how beautiful Dunedin was with all of that coastline until I left and went overseas, and then came back.”

The area has also seen a lot of growth in recent years, something Maclean says was a positive by-product of the covid pandemic.

“The work from home setup has become more commonplace now and means that you don’t have to be based in Auckland or Wellington to be working for some of the bigger companies out there.”

“The affordability down here for the housing and the lifestyle it offers is really appealing. So we’re getting people that have had enough of the big city, and are looking for something else. It has been a big boost for Dunedin.”

That also means a boost for a number of suburbs across the city, with four areas in particular catching Maclean’s eye. So what can you expect from each of them, and how much are you likely to pay for a property there?

CAVERSHAM

Maclean says one of the more affordable suburbs of Caversham has seen a big boost due to a raft of rule changes related to zoning. The changes mainly relate to the number of residential units you can have per site, and the minimum site size required for subdivision.

“It means that you can have a bedroom for every 45 square metres. So if you get an old house on a 450 square metre section, that means a developer can build five two-bedroom duplex style homes.”

“Caversham is probably the area that has undergone the most transformation, which is bringing younger people to the suburb.”

Maclean says a lot of the homes are tenanted, but are of very high quality and many owner-occupier properties have also been renovated.

“Some of the old character homes which were run down are now lovely and are still affordable.”

With the popularity of terraced housing continuing to grow in Caversham, it’s becoming a sought after location for investors.

“There were some old houses that were probably not habitable. They got pulled down and developers built a whole village of these duplex type terraced houses - all of which have helped to uplift the suburb.”

The area also fared well in the recent floods.

“It’s around the second time in the last 10 years that we've been hit, and most of Caversham offers a lifestyle on the flat without too much of the flood risk. So that's really appealing as well.”

As for local amenities, Maclean says there’s a great medical hub, and a lot of good schooling.

“It’s got great transport links and is a 10-minute walk to St Clair without the St Clair pricing. It's also got some nice wee restaurants too.”

So what can you expect to pay? Maclean says right now the median sale price in Caversham is $453,000.

NORTH DUNEDIN

Maclean says with rules like interest deductibility and the brightline test favouring investors a lot more, he expects the North Dunedin market to heat up a lot more in the coming months.

“Investors got hit with a big stick over the last few years, so there was no motive, appeal, or incentive for them to buy an investment property. So the transactions in North Dunedin, which is primarily a student market, really slowed down and stopped.”

“With that behind us, there’ll be some developments in that area, and there will be improvements too.”

Maclean says many student tenants also expect a much higher standard of living now.

“It's a different demographic. Now, with students, they do want a little bit more. Most of the student pubs are gone now, and they don't want to live like they used to in the nineties.”

“So there’s demand there for a landlord who is willing to provide a better quality product.”

It’s a better quality product that then helps to improve the overall neighbourhood, and make it more attractive to potential tenants.

“It’s definitely the time for investors to come back into it. If you’ve got the right product, and the right price for your property, there is obviously a guaranteed rental market there with students coming and going.”

Maclean says the overall area in North Dunedin is really appealing, with close proximity to the university and lots of hospitality just a short walk away.

“So there's lots of walking tracks, cafes, and a lot of little bars, geared towards the students.”

“It has a lot going for it, and for eight or nine months of the year it is gloriously busy with young people.”

The median sale price for a home in North Dunedin is around $625,500.

SAINT CLAIR

Maclean says St Clair has always been really popular over the past 15 years.

“It’s also one of our most protected areas too. We had strict development rules, but now there’s pockets where the new zoning rules apply and we’re seeing some upmarket townhouses being built on some older properties.”

“There are older properties that really viable for a developer to buy and pull down. So the nice houses are still there, but the older properties are now being turned into luxury.”

Maclean says two have just been fully developed and moved into, and there’s two more on the way. “So that's had an appeal for the area as a whole.”

Despite being a suburb in the higher price range, St Clair has a broad range of people too.

“St Clair is probably a step up more than a first home, but it does have some affordable properties that could do with some work.”

Maclean says it’s the perfect place for anyone who loves the outdoors, with spectacular views and beachside living.

“There are lovely cafes right across the esplanade area. There's the hot saltwater pool and a spot where you can sit straight along the surf line and watch the surfers do their thing.”

“It’s a really lovely part of town.”

Maclean says right now the median price for a St Clair property is $845,000.

MAORI HILL

Another suburb that’s benefited from changes to zoning rules is Maori Hill. Traditionally Dunedin’s most expensive suburb, Maclean says parts are now allowed to be developed into townhouses.

“We've got a couple of properties that are about 1000 square metres up there, and the developers are lining up.”

“If you've lived in Maori Hill your whole life, you know that to get a townhouse is quite hard, and to get a really modern townhouse is even harder.”

While the area is known for its history and prestige, Maclean says now its being recognised for its growth opportunity and future.

“I just think that with some of those older houses that we had popping up from time to time in Maori Hill, we would get people wanting to buy them and maybe look at spending some money on them. But now we get people lining up to develop them as well.”

“There's an opportunity for some people to do really well. They could buy, potentially land bank, and collect some holding income with the idea that down the track, they can put some townhouses on it, which will always be in demand.”

The area has also got everything you need to enjoy the Dunedin lifestyle.

“It's got the schools, it's got the transport links, and it's got cafes and restaurants.”

So how much would a new place set you back? Maclean says right now the median sale price for Maori Hill is $1,060,000.