New homes are selling like hotcakes
New homes, standalone, terraced townhouses and apartments are all being snapped up by Kiwis.11 August 2020
If you’ve set your heart on a new home, and you’re happy to wait for completion in 2021 or 2022, you’ll still have to get in quick because well-designed, quality-built homes, townhouses and apartments are flying out the door.
Since lockdown, the dedicated Trade Me Property New Homes category has seen a huge spike in traffic, unique listing page views were 2x higher in July compared to this time last year*. Unique member Watchlist adds meanwhile have doubled since the beginning of April**
Group builders are telling Trade Me they’ve never seen interest in new builds higher as people seek better quality space with more options after a lockdown where they saw all the flaws of their older homes.
And new townhouses are in especially high demand, according to StatsNZ. Of the new homes consented in the June 2020 quarter (a total of 9,213) 2,620 were townhouses, flats and units.
The Kōtuitui housing development in central Manukau
The Kōtuitui housing development in central Manukau, created by the Avant Group and South Auckland Māori iwi, Te Ākitai Waiohua, has benefited from the strong interest in townhouses, with its two and three storey terrace homes.
What sets this Avant Group development, a mix of Kiwibuild and open market homes, apart. is that it’s terrace housing. Many people prefer this over apartments, says the agent, Colliers’ National Director, Pete Evans.
Amenities and transport connections huge importance for new developments
Something that has made the marketing of Kōtuitui easy, says Mr Evans, is the central location – it’s just 400m from Manukau railway station, as well as being close to amenities such as the Westfield Manukau City shopping centre.
Many of the buyers of these homes are new to Manukau, says the Colliers’ director. They’re coming from closer to the city, Ellerslie, Mt. Roskill and Onehunga.
They’re happy to come to Manukau because amenities are important to them and they want an architectural home within their budget. The proximity of the train station is also a big bonus for them, says Mr Evans.
Buyers like the terrace homes for the lifestyle they provide – there’s a standard courtyard finish, but then you can choose if you want a vege or herb garden.
Colliers currently has 59 out of 61 sold of the Crosson Architects-designed development with another 15 homes coming to the market in the next few weeks. The majority of these are three bedroom, and around the $640,000 to $750,000 price range. The first phase will start construction in mid November.
As with all housing finance, it’s taking time for purchasers to secure finance. But there’s huge interest so if the finance on a home falls over, it’s immediately sold to someone else, says the Colliers director. As is often the case with popular developments, there’s a waiting list of interested buyers.
The banks’ preferred product type for new homes is brand new terraces, which is what Kōtuitui offers, says Mr Evans. On terrace homes they will lend up to 90% on the home compared with the more standard 80% on apartments, he says.
South Auckland housing subdivision sells out
Further south down the Auckland Southern Motorway, Adam Paterson from Precision Homes is reporting very strong sales. The first phase of the company’s Paerata Rise housing subdivision, north of Pukekohe, has sold out.
“First home buyers were 10% of the market and now they’ve gone up to about 30 to 40%,” he says.
As well as 21 confirmed sales at the Paerata Rise subdivision and in other parts of South Auckland, a further 23 are in the pipeline for the next two years. Precision Homes will build on land you have bought and found yourself.
Prices at Paerata Rise for house and land packages range from $650,000 to $1.5 million. The most popular design styles are the Pavillion, a boat shed look, and the Monopitch, says Mr Paterson.
31 Jonah Lomu Drive, Paerata
People like the Precision Homes’ product for the workmanship, quality of the design and the standards, he says.
“They’re getting something different from the norm, it’s why they come to a custom builder like us,” he says.
People are asking the company to build in various locations – for baches and waterfront homes, among others. A good portion of inquiries are for home and income options which is a growing market, says Mr Paterson.
People are actively hunting for semi-rural, large sections of between 1500 sq m and 4000 sq m to accommodate these dwellings.They are well suited for intergenerational households and people wanting extra revenue streams.
Bay of Plenty a hub of new housing
New homes are in demand all over the country. Tremains agent, Brent Bastin says the Bay of Plenty market is seeing a lot of new homes come online. He’s finding buyers have become more discerning in the last year.
“People are spending far more time analysing the quality of the new home,” he says.
They’re looking for something that is aesthetically attractive, something really beautiful, he adds.
Little features count. “People want a uniqueness, something that’s not been done by anyone else. They’re coming in, saying I love the design style, but if it’s pretty stock standard. They’ll say: “Show me something with the ex-factor.” We’re moving away from the polished cookie cutter style,” he says.
If someone is building something new, when their friends turn up, they want to talk about the tile they picked in the shower, the reason why they went with brass tapware, why they wanted wallpaper for a feature wall, he says. They want individuality but without the risk.
In Wellington, buyers follow favourite developers from project to project
Meanwhile, down in the capital, new homes are in demand from a wide range of buyers from first home seekers to the most active group, empty nesters looking to downsize.
Tim Clark, in charge of marketing new developments at Tommy’s Real Estate, finds that buyers will follow a developer around from project to project once they know and like one of their new homes. People who are more discerning, like that they have a track record.
“They buy for themselves or as investments,” he says.
Stratum Management in Wellington has done multiple developments around Wellington, and its latest building, Two One Two, 92 apartments at 212 Willis Street, was 50% sold in the first three weeks of marketing. Construction starts June next year and it’ll be ready at the end of 2022, with prices ranging from $452,0000 to over $900,000.
Interest has come from owner occupiers, some investors, first home buyers, professionals, and people who commute and want a place in town. “We’ve got a full range of the market coming into the building,” says Mr Clark.
The advantage of buying brand new is people are assured that the building regulations are up to council standard which is important in an earthquake prone city like Wellington.
Two One Two Willis is very light and bright, it doesn’t have any buildings up against it, says the Tommy’s agent.
“It has a lot of technology, a sensor on every floor which can detect any (earthquake) event that can be reported back to engineers, that’s a huge piece for buyers,” says Mr Clark.
This development is in central Wellington. However, according to Wellington-based Infometrics economist, Brad Olsen we’ll be seeing strong and growing medium density developments next in urban cities on the fringes more, as is happening in Manawatu and Auckland.
*Trade Me site statistics, July 2019 vs July 2020
** Trade Me site statistics, watchlist adds, New Homes category, 12 April vs 2 August 2020