The flight to the regions

Tranquillity beckons and the cost of living is lower, writes Rob Stock.

Many a harassed citydweller dreams of escaping the rat race to a better, more relaxed life in a beachside town.

Some, like businessman Gary Alway, do more than dream.

Alway cashed up his villa in the Auckland suburb of Mt Albert and headed to Waihi Beach, just north of Tauranga.

He’d been in Auckland 20 years, and he’d had enough.

It was time, he thought, to leave the rush and congestion and do what so many talk about: find a better quality of life outside of New Zealand’s commercial capital.

PROPERTY

There are many reasons people go from a big city like Auckland to a smaller town. Some leave to return ‘‘home’’, some to find a better life balance.

One of the biggest attractions is being able to go mortgage-free, or even swap renting for homeownership.

‘‘You get so much more for your dollar,’’ Alway says. ‘‘We got a four-year-old, four-bedroom house with all the modern stuff like insulation and double-glazing for $700,000.’’

Buying it wasn’t hard. ‘‘We sold our 130-year-old Mt Albert villa for $1.3 million,’’ he says.

Auckland villas are notorious for being cold and draughty in winter.

‘‘When someone jumped, all the windows shook,’’ Alway says.

Moving to the regions can feel like buying a one-way ticket.

Once you have sold up in Auckland, prices in the ‘‘city of sales’’ can quickly move beyond your reach. And, if there were a fall in Auckland, many think prices in the regions would tank too.

Alway, who has now gone into real estate with LJ Hooker, doesn’t expect either to happen.

But nor does he think of it as a one-way ticket, despite having no intention of returning.

If there was a tempting job offer, there’s always the option of renting out a home in the regions, and leasing an apartment in the city for a few years.

Priced out of Auckland homes, that’s exactly what many young ‘‘rentvesters’’ are doing.

Alway says others of greater means maintain a small city apartment and a house by the beach.

The capital cost of the two properties equals the cost of one house in Auckland, though Alway says regional rates can be higher than big city rates.

Alway’s rates bill is around $4000, he says.

CASH FLOW

Moving to a regional town or city can have a dramatic impact on a family’s cashflow, even if they take a pay cut.

Big city mortgages and rents take a big bite out of household incomes.

Every year the Demographia housing survey compares median household incomes to median house prices in our cities. The last one showed a multiple of 9.1 in Auckland in late 2015.

In Palmerston North it was 4.1, in Christchurch 6.1, in Hamilton 5.1, and in Wellington 5.2.

Even on a lower salary, afterhousing incomes are often higher in regional towns and cities, meaning households can live more comfortable lives with less debt.

‘‘90 per cent of Aucklanders are one pay cheque away from insolvency,’’ Alway says.

The Numbeo website allows people considering a move to compare the cost of living in different cities.

It shows that the cost of renting a three-bedroom house outside of

‘‘I have had a year off to recharge after a 20-year Auckland battering. That’s Auckland for everybody. It is all go, all the time.’’ Gary Alway, who moved to Waihi Beach

the city centre is 38.5 per cent less in Hamilton than in Auckland. In Rotorua, the cost is 94.7 per cent less.

Incomes are lower, but not to such a degree.

Statistics NZ data shows the median household income in