Apartments prove more popular

Apartments are becoming more popular with first-home buyers, inner-city real estate agency City Sales says.

Tuesday, October 21st 2014, 12:00AM

by The Landlord

Prime Minister John Key said this week that people buying for the first time could look at apartments instead of standalone houses.

"Some people will have to consider going into an apartment, for instance - that has been the international change," Key said. "If you're a young person buying your first place in Sydney or Melbourne or Brisbane, in most instances you'll be going into an apartment."

City Sales sales director Mike Richards said one-bedroom units in the CBD and fringes selling for up to $350,000 had become popular with first-home buyers.

They were looking for larger apartments to satisfy bank lending criteria, he said.

Richards said two-bedroom apartments with carparks up to $500,000 were also increasingly popular.

Commentator Olly Newland said there was good value to be had in the apartment market. He said some were still selling at about half the cost of building them.

Key said today he expects the Government’s strategies to increase the supply of land for building could lead to lower house prices.

Just five houses have so far been built in Auckland’s Special Housing Areas.

But Key said the policy would have an effect over time. He said property owners should be wary about thinking prices were a “one-way bet”. "I wouldn't be surprised if the discussion three years from now is about how many houses are available. There's going to be a hell of a lot of houses built over the course of the next three or four years, there's a lot of land released. If you look at those Special Housing Areas they will account for tens of thousands of new dwellings."

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