Houses for less than $1 million in Auckland's premium suburbs are on the verge of extinction, new research shows.
OneRoof.co.nz and data partners Valocity tallied the number of houses with CVs of less than $1 million for sale in 12 of the city's most in-demand suburbs and found that they accounted for 12 percent of listings.
The research also looked at the number of houses that sold in those suburbs for less than $1 million.
OneRoof.co.nz and Valocity found that there are close to 44,000 properties in Ponsonby, Grey Lynn, Herne Bay, Westmere, St Marys Bay, Remuera, Mount Eden, Parnell, Epsom, St Heliers, Devonport and Campbells Bay, where median property values range from $1.4 million to $2.5 million.
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Of those homes, only 22 percent, or 9770 properties, had CVs of $1 million or less. Four percent of the 44,000 properties changed hands in 2018, but only 13 percent of those sales were for less than $1 million.
OneRoof.co.nz editor Owen Vaughan says: "If your heart is set on a home with a white picket fence in one of these desirable suburbs, the chances are slim. Owners know what they have and the numbers suggest they are hanging on."
However, listings show that it is possible. Just. A two-bedroom cottage with parking and a garden in Brisbane Street, Grey Lynn, has been listed with an asking price of $915,000.
>>> Find out more about 22 Brisbane St here
Sales agent Keith Dowdle, from Custom Residential, who is marketing the 59sq m property, says: “To find a free-standing character home for less than $1m in Grey Lynn is very rare. This price point is usually more on apartments and units. Two weeks ago, we sold a two bedroom renovated cottage in Arch Hill for $1.36m.
22 Brisbane Street in Auckland's Grey Lynn is for sale for $915,000. Photo / OneRoof.co.nz
“The Brisbane Street home is on a cross-lease title so still gives a freehold landholding without the body corporate fees that go with an apartment."
He adds: “Buyers [at that price point] can expect to buy a home that may need some work – even if only cosmetic, a more compact home or a smaller site.”
While cross-lease titles are more common through the inner eastern suburbs they provide a rare affordable entry for the Ponsonby area. Dowdle says many buyers aren’t prepared to compromise on a bigger place further out of the city, preferring the prime locations within walking distance to the city.
“The appeal of these areas will only continue to grow as commuters become less tolerant of time and distance travelled, along with the associated costs,” Dowdle says.
Bayleys national head of residential Daniel Coulson says buyers wanting entry level in desirable suburbs will need to adjust their expectations on what type of property they can get - apartments, townhouses and units rather than standalone houses.
“How often do three-bedroom, two-bathroom villas with white picket fences come on the market with CVs under a million? They simply don’t,” he says.
Parnell, the first suburb east of the city, demonstrates that suburb of two halves dichotomy. At one end of the scale, 40 percent of its properties (and 40 percent of sales) were valued at under $1 million. A sizeable chunk of last year’s sales (18 percent) were even under $500,000, mostly apartments dotted at the city and Newmarket edges. At the other end of the scale, 32 percent of Parnell properties sold for over $2 million, with the suburb’s top sale to the year to August hitting $9.2 million.
Bargain hunters might also have some luck in Mount Eden, where just over one third of properties have CV of less than $1 million, compared to one in five properties in Herne Bay or Epsom. That proportion dwindles to only 12 percent in Ponsonby. Head out to Campbells Bay and fewer than three percent of properties have a CV of less than $1 million.
Dowdle is noticing older rental properties, maybe in need of upgrading to meet new tenancy requirements, are coming to market.
“With other investors not so active in the market, these properties can represent fantastic opportunities for owner/occupier buyers prepared to add value through simple upgrades – especially if they are prepared to do some work themselves,” he says.
Coulson adds: “There are always opportunities in every market and this one is no different. There have been reports of more affordability in areas that buyers once thought were out of reach, my advice would be ignore the CV, talk to the agent and get a good understanding of what else has sold within the last month.”
