A young couple beat out four other bidders for a three-bedroom home in South Auckland that had been put on the market by a property investor who was at breaking point.
The first-home buyers picked up a renovated home on O’Connell Street, in Manurewa, for $890,000 at auction last week, after missing out on several other properties.
Harcourts Papakura agent Alex Dunn said the sale was a relief for both the investor and the buyers.
The property had attracted bids from five first-home buyers and one investor at the Harcourts auction.
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The owner plans to use some of the proceeds from the sale to do up another property in his investment portfolio for on-selling.
Dunn said the vendor was “so happy and relieved”, adding that the quick settlement would take the pressure off.
The property was announced on the market at $885,000 and sold for $890,000, which Dunn says was in line with both his and the vendor’s expectations. It is also $30,000 above CV.
Dunn told OneRoof last month that his client was feeling the pinch due to the interest rate rises.
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The investor will now use the deposit from the O’Connell Street to carry out some work on another of his Manurewa rentals before putting it on the market next month.
The couple who took the entry-level home off his hands were pleased to have finally got on the property ladder after shelling out for building reports on several other properties only to then miss out on them.
Their bank pre-approval was also about to expire, and they had been worried they might have less to spend when it was renewed.
Dunn said there were a lot of first-home buyers at the auction looking for renovated three-bedroom, one-bathroom homes, which are typically selling for between $800,000 and $850,000.
“First-home buyers are not looking at anything that needs any work. If it needs a paint, if it needs carpet – they won’t touch it.”
A newly renovated four-bedroom, home on Old Wairoa Road in Papakura was withdrawn from auction after the first people who viewed the property fell in love with it. Dunn said they made an offer of $789,000 and the owner accepted it.
The owner had bought the dated property a few months prior for the early $600,000s with plans to renovate it and hold onto it, but when he saw the lift in the market, he decided to try his luck selling it.
First-home buyers also beat off 10 other bidders to buy a small four-bedroom home on a 382sqm section on Castlepoint Avenue, in Takanini, for $1.075 million – $95,000 over RV.
A four-bedroom home on Old Wairoa Road, in Papakura, was bought, renovated and re-sold within four months. Photo / Supplied
A four-bedroom, two-bathroom home on Castlepoint Avenue, in Takanini, sold for $1.075m. Photo / Supplied
Harcourts listing agent Ricky Balu said they had already missed out on quite a few properties and were feeling “pretty frustrated”. They had been prepared to pay even more for it, he said, with the bidding jumping up in large increments of about $50,000.
Similar houses in the area had been selling for just under $1m and close to CV, but the shortage of good quality homes on the market and pushed the price up. It was zoned for the popular Kauri Point School and was close to shops.
Harcourts auctioneer Aaron Davis said the room was so packed with predominantly first-home buyers that they even had to tell the agents to get out to make room.
Of the 20 properties called last Thursday night, nine sold under the hammer, one sold prior to the auction, and one just after.
But Davis said some of the best auctions with the most competition were ironically the ones that didn’t sell.
“What happens at auction is sometimes thought vendors go, ‘no I want more’, and you go, ‘man we’ve just had six bidders go hammer and tong on this and it didn’t sell’.”
Davis said sometimes owners want more than what people bid up to because they want someone “to buy their circumstances, not their property”.
“If you bought it five, six, seven, eight, nine, 10, 11, 12 years ago piece of cake, but if you bought it a couple of years ago it’s a problematic market and you need a true real estate professional to get you out of jail.”
There were more than 80 groups through three open homes for Kimpton Road, in Papatoetoe, at the weekend. Photo / Supplied
Barfoot & Thompson Papatoetoe agent Parry Singla agreed that the first-home buyer market was “pumping” again.
A four-bedroom, one-bathroom home on 91 Kimpton Rise, in Papatoetoe, marketed by his colleagues Amit Kumar and Girish Verma, saw 81 groups through the first three open homes held last Thursday and on Saturday and Sunday.
Singla said it’s the type of property first-home buyers are keen on. “Suburbs like Papatoetoe are very hot ... properties in [the] Papatoetoe area particularly are flying out the door.”
Both first-home buyers and developers are back looking, he said, but there’s not much to choose from.
“It’s coming, but it’s not enough ... we are getting calls every day asking what’s new and what’s coming from buyers at the moment.”
Earlier this year, he sold a three-bedroom home on Stonex Road, in Papatoetoe, to a property trader who lopped off about 200sqm of the large L-shaped section and sold it to a neighbour looking to increase their section size for about $160,000. He then spent about $100,000 renovating the three-bedroom house before on-selling it to first-home buyers for $1.081m at auction on the reduced 1156sqm section in August.
“It was a good $300,000 / $350,000 margin (before tax) in a short amount of time.”
Singla estimated the trader walked away with a profit of about $300,000 before tax.
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