mattwnz: I can't see Auckland house prices increasing 10% a year, as they are already overprices. There is going to be a correction at some stage, although probably won't be until interest rates  rise, as cheap credit and lack of supply that is fueling it. In Wellington since the GFC prices have been relatively static, so they don't always go up. But even if houses prices do go up, so will everyones, so proportionally you will be paying around the same in rates + a percentage a year, unless proportionally yours rise by more. They shouldn't however be going up by more than inflation. That is possibly why some people are paying a lot more now, because proportionally their house value has gone up more than others. But as rates are a wealth tax now, that is a cost of living in an expensive house and area.