How popular are Auckland’s apartments?
As with many large cities throughout the world, Auckland has a thriving property market. Sales have remained strong at times when other regions have struggled, and it seems to be apartments that are leading the charge.
Areas surrounding Auckland have picked up some pace over recent months, but it’s still the CBD’s real estate that is the one to watch. Measures to address high levels of investment are so far having an effect and could be crucial to how the market is shaped in the near future.
Tracking the apartment trend
Buyers have been keen to get their hands on Auckland apartments for many decades. Information collated from the 2006 Census showed it is typically younger people who are attracted to this type of property. In fact, 49 per cent of those living in apartments at the time of the Census were between the ages of 20 and 29.
Alongside Wellington, Auckland emerged as having high proportions of inner city apartment dwellers in this age bracket. In Christchurch, people generally fell into the 30 and over age group.
Meanwhile, a report from Statistics New Zealand titled Housing in Auckland discovered that in 2013, apartments comprised 14.1 per cent of occupied joined dwellings. This compared to 10.2 per cent three years earlier.
The study also noted there has been a rise in the number of consents issued for apartments. More than half of all consents issued for new apartments between 1991 and 2014 were for the Auckland region.
Prospect of price rises
One motivator people might have for investing in this type of real estate is the potential for strong returns. Results of the latest QV House Price Index show values in Auckland are still increasing, albeit at a slower rate than in the past.
Buyers have been keen to get their hands on Auckland apartments for many decades.
Action has been taken to reduce investment lending in New Zealand, but this hasn’t had too much of an impact on demand for apartments, auction results or values.
Property prices in the suburbs formally covered by Auckland City Council have risen 22.8 per cent since November last year, and 6.1 per cent over the past three months alone. This could offer some significant opportunities for anyone who is yet to invest in this thriving city.
Apartments have strong rental property prospects, which could lead to a greater number of investors seeing the potential of this part of the country. This is a trend that has already become apparent over recent years, but has every chance of being able to continue.