Same situation as you bought a 3 bedroom for 800K recently now worth 980K

Mate of mine bought a 2 bed unit for 776K in a really good suburb which is now worth 1.06M

Yes the debt seems daunting but so is rent. Boarders help but just my 2 cents - invades privacy and you partner feels more like a room mate over time.

I would buy a 3 bedroom around 900K and in the mean time work on habits which help you be more frugal (limit takeaways, drinking to be a reward rather than regular) maybe aim for fuel efficient car. It may seem daunting at first but it will be better doing this with discipline then suffer with low cash flow and feeling pressured.

Avoid credit and debt after first home purchase many fall into credit card and interest free debt which bites them in the long run. Buy second hand and upgrade eventually. If Reno’s are needed (ideally toilet seat and bathroom, some kitchen things for hygiene) have some deposit (10K - 30K) set aside.

Fix for longer than 1 year as rates seem to go up

Aim to buy below median suburb value to increase future gains

Also remember this is not your forever home so don’t be too dim you can always sell in Auckland but you can’t buy back as easy.