Some people might have questioned Shane Brealey’s decision to list 15 apartments for sale during the first week of a nationwide lockdown.
Open homes were closed. In-person meetings were out of the question. The market was facing uncertainty about jobs, the economy and the social impacts of a global pandemic.
Despite all this, Auckland property developer Brealey (also director of NZ Living) put 15 apartments at 165 Lake Road, Northcote, on the market on March 30. He simply listed the apartments digitally and on social media, with a link to the project’s website.
“There was no opportunity to run appointments to view a display suite,” says Brealey. However detailed plans, building specifications and high-quality renders were made available online.
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Traditionally, Kiwis have preferred to view completed builds before buying but Brealey says tech-savvy first-home buyers are more inclined to “shop with their fingertips” on laptops or smartphones.
“I think people like shopping with their fingertips and having transparent and full information available online. This can be shared with family and friends, and they can make their own mind up, only asking questions should they have any.”
The numbers speak for themselves. During the four weeks of Level 4 lockdown, Brealey had 230 enquiries, seven unconditional sales and a further six under contract. There are now nine apartments sold and four conditional contracts signed.
Each apartment was $600,000 and all buyers chose to include a carpark for an additional $40,000. That’s $8.32 million in apartment sales, off plans, at the height of the COVID-19 lockdown.
Brealey says most of the inquiries and sales were handled via email, with only 10 per cent of buyers choosing to communicate on the phone: “We have not even spoken to half our buyers. People were at home and had time to ‘shop’. Perhaps the lockdown was the last straw for some living at home with their parents.”
He also attributes the sales to the location, quality and price of the Lake Road apartments, located within the Northcote Development.
“The properties we were selling are in a great location, will be well built and are at a compelling price-point under valuation by virtue of the KiwiBuild underwrite reducing our costs to enable this.”
The apartments will be low-maintenance, high-quality, well-connected to Northcote’s schools, public transport links, local shops and eateries, and just eight kilometres from the Auckland CBD.
165 Lake Road offers buyers a chance to get ahead of the market. Photo / Supplied
The benefits of buying off-plan
Brealey says there are obvious benefits to buying off the plans that are accentuated in a competitive property market: “You buy at today’s prices and pay later when the project is completed, giving you more time to save and plan for moving in.
“You get a brand new home that you have selected early, whereas buyers who want to wait until it is completed might find there are few, if any, apartments they like left.”
He says it’s important information provided online is “specific and comprehensive”, from the plans and building materials, right down to the appliances and chattels. This helps to give buyers confidence.
“We give the brand and model numbers for appliances. I have seen developers who list, for example, ‘Oven, yes’ or ‘Oven, white’. If you try to limit available information... it is off-putting.”
Having a good track record as a developer also helps as buyers can drive by past projects and judge quality for themselves.
Brealey says he thinks buying off the plans will become increasingly popular as more large-scale, higher-density residential developments come on the market.
“Ask any buyer if they would rather pay an extra 2-2.5per cent – $12-$15,000 – to have the convenience of dealing with a real estate agent. There is a place for standalone property sales but less so with larger project marketing where the product is well located, built and priced.”
‘Pent-up demand’ for apartments
The lockdown sales of the Lake Road apartments were not entirely unexpected given the success of Brealey’s most recent development at Fraser Avenue, also located within the Northcote Development. The 102 apartments listed for sale in October last year “all but sold out” off the plans in four months.
There are currently only four apartments left at Fraser Avenue, which is about three months from completion, with Brealey saying: “There was probably some pent up demand for a new offering.”
He expects the next project release in Awataha Drive, which includes 12 two-bedroom and one three-bedroom KiwiBuild apartments, and nine market apartments, will sell just as quickly.
- This content was supplied by Kāinga Ora
