How to get ahead in the apartment market
Forget shoebox living: the Auckland apartment market is all about quality - and buyers are driving the changes.
Barfoot & Thompson projects manager Matt Baird has seen the quality of apartments getting better and better over the past 20 years.
Good enough to get Aucklanders, both first home buyers and baby boomers rightsizing from the family home, into catching up with other global cities in adopting apartment living.
“The market is demanding quality,” says Baird. “At the high end, that’s amenities like cinema rooms, roof terraces, gyms and business centres.
“At the first home buyer end, it’s giving options around shifting from car parking to things like electric bikes and scooters.”
With inner city land becoming increasingly rare, Baird says developments are moving to the city fringe. For affordable first homes, this is generally around transit hubs. New apartment developments will also often spur the arrival of amenities .
Developers look at the success of the New Lynn town centre regeneration, where cafes and shops sprang up around the Merchant Quarter, and hope to replicate that in suburbs like Avondale, which is rejuvenating around the train station, Waterview or Glen Eden.
Closer to the city, apartment projects are in planning around Grafton and Eden Tce, spurred by the anticipated release of more than 100,000 sq m for the mixed-use precinct around the new CRL Mt Eden station.
Further south, projects like McLennan, in Takanini, which includes Kiwibuild properties, and Belmont, in Pukekohe, are shifting buyers to smaller houses to increase affordability.
“We’ve sold 52 houses in 12 weeks at McLennan. The further from the city centre, the less demand there is for apartments and terraces,” says Baird.
Baird sees a growing demand for buyers willing to sacrifice space for affordable high density living, close to the city and amenities. Once buyers see finished homes, it becomes easier for them to understand the benefits of low-maintenance apartments.
Baird says that the important number is $650,000, the cut-off for government and KiwiSaver loans, but he’s recently seen success marketing onebedroom chalets from $420,000.
At the upper end of the scale, Barfoot & Thompson is marketing projects like 30 Madden at Wynyard Quarter. The company has sold $25m of stock in the past six weeks, Baird says, as the high end market experiences a bounce much like that of Sydney and Melbourne.
With fewer opportunities for developments around the Grey Lynn ridge, buyers are moving out to Morningside and Kingsland.
In the eastern suburbs and bays, because the cost of land is so high, apartments are highend and as large as a single family house. On the North Shore, demand is high for sea views and amenities in apartments from Takapuna, Milford and up the bays. Further inland, buyers are more interested in the more familiar town house.
How to buy an apartment off the plan
1. Do your research into the developer: Look at other projects they’ve done, how well they’ve aged.
2. Understand the plan and what you’re getting: Not every permutation of floor plan will be on view at project show rooms, so you need to understand the exact dimensions of the apartment. Showrooms may have different finishes or upgrades from the one you’re looking at, so be clear what your finishes will be.
3. Understand the neighbourhood: When the apartments are still holes in the ground, it is hard to see how your new neighbourhood will change. Go online, look at council and local websites to see what new transport, shopping, parks or schools are in the pipeline (and how far off they are).
4. Get professional advice: No matter how well-known the brands are, you still need to get all the contract documents seen by your conveyancer, lawyer and bank so you understand what you’re getting, what the payment schedule is and so on.
5. And check out the developer, again: Baird says knowing the developer (and builder and team) is the number one, two and three priority for any new apartment buyer.