Never say never

Lease

Sb. says apartment price can never go up as there's minimal portion of land on it. BUT Never say never.

Changing Auckland skyline as apartment market bounces back
                                

By Susie Nordqvist

First homebuyers being squeezed out of the suburbs by record house prices and expats conditioned to living in small spaces are fuelling a recovery in the apartment market.

Some apartments are selling for 30 percent more than they did a year ago.

They all but disappeared from Auckland’s skyline following the global financial crisis.

But construction cranes are making a welcome return as the city scrambles to build enough homes for an additional 1.2 million people.

“Four-hundred-thousand properties have to be built in the next 30 years, and you don't build them on quarter-acre sections,” says Properazzi property commentator Alistair Helm. “They don't exist and we can't afford to do that.”

So apartments are making a comeback, but it's no longer investors who are dominating the market.

                                                               

Sixty percent of buyer interest is now coming from owner occupiers.

“[It is coming from] the first homebuyers mainly trying to step into the property ladder,” says real estate agent Hamish Duke. “Secondary, we've got the expats coming from overseas who are conditioned to apartment living.”

First homebuyer George Meyer says buying an apartment was a no-brainer.

“I did the numbers and this particular property here would rent out about $500 a week, which on your own is a lot of money to be throwing away in rent,” says Mr Meyer. “Five-hundred dollars a week going into my mortgage finances it quite easily.”

Banks no longer require a 50 percent deposit for small apartments, and that's brought the first homebuyers flooding back, causing values to spike by up to 30 percent in some complexes this year.

“This is based on an emotional buy from first homebuyers,” says Mr Duke. “It's not purely on return.”

So while the news isn't as good for investors who are facing increased competition and lower yields, it has given Kiwis a more viable option to get onto the first rung of the property ladder.

3 News

Read more: http://www.3news.co.nz/Changing-Auckland-skyline-as-apartment-market-bounces-back/tabid/421/articleID/276273/Default.aspx#ixzz2BxfB5pHW