Growing shortage of top end city apartments
Construction of apartments has stalled this year after a strong period of growth, amidst suggestions that the top end apartment market is heading into a serious shortage.
Wednesday, July 25th 2007, 12:00AM
by The Landlord
“The apartment market in Auckland has been turned on its head; while much public focus has been on rock bottom sales of cheap inner-city apartments, the real issue is that the top end market is moving into a shortage, says Miles Morton of Holdam Developments Ltd.
Buyers are now demanding bigger apartments with better quality design and fit-outs, Morton says.
This trend is confirmed by Key2 apartment specialist Russell Benshaw, who says that the recent trend in the apartment market “has caught a lot of people out”.
Benshaw says, “We have buyers suddenly wanting to buy top end apartments and we have very little to show them because of a combination of escalating building costs, council development levies and interest rates. Those that are underway are in big demand and as a result prices are rising”.
He says the market is moving from investors to owner-occupiers, driven by the fact that Auckland residential property prices are continuing to rise.
“Buyers who find they are priced out of the ‘standalone bungalow’ market are looking at apartments, but want sufficient space to enjoy the lifestyle equivalent of a traditional house,” Benshaw says.
There is a growing realisation that in a year’s time there will be a “mighty shortage” of new, quality apartment stock, says Morton.
Morton believes that Great North Road is destined to become the next big apartment area. “Great North Road will become the next Ponsonby Road in the coming years.”
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