Is this Auckland's cheapest property?

Central Auckland apartments usually come with at least a six-figure price tag but for less than $90,000, could this be the city's cheapest apartment?

The 40sq m, 1-bedroom apartment in the Q-City building on City St in Auckland central is for sale with an asking price of only $89,000.

Based on that price the square metre rate is $2225 - even less if you include the 5sq m balcony - making it the cheapest apartment, by square metres, currently listed for sale in Auckland.

But though it's cheap, it comes with a catch.

The apartment is a leasehold which means the buyer owns the apartment but not the land it is on and would have to fork out more than $11,400 a year in ground rent and body corporate fees.

The fourth-floor abode is being marketed as an investment opportunity or the perfect spot for your children to live while studying at Auckland University or AUT.

Ray White City Apartments agent Mitch Agnew, who is marketing the property, said it was "definitely one of the cheapest apartments in the city that doesn't have remedial issues".

He said buyers might be interested in it for cash flow or as an inner-city crash pad.

Agnew said there was usually demand at that price range but the lack of a current tenant in the midst of a global pandemic was not as appealing to investors.

"Something like that would usually get snapped up but without international students it's proving to be a bit more of an issue," he said.

The minimum apartment size allowed for a new build in Auckland is 35sq m which is large compared to international standards. In London the minimum is 19sq m and in Paris just 9sq m.

OneRoof editor Owen Vaughan said the Auckland apartment was definitely at the cheap end of the market but first-home buyers were often caught out by the hidden costs like the ground rent and body corporate fees.

Banks were also often reluctant to lend on such properties, he said, and there was usually little to no capital growth on them.

"When you're dealing with prices like that you're in Wild West territory, there are so many unknowns," he said.

Vaughan said the city's apartment market had been soft since the Covid-19 outbreak since demand from the international student market dried up on the back of border closures.

However, it had started to pick up in the past couple of weeks thanks to buyers put off by the heated prices and crowds in the rest of the residential market over the past two months, Ray White City Realty auction manager Cameron Brain said.

"The apartment market is always slightly behind the residential market, but it's really picked up the last two weeks," he said.

Brain said with the return of ex-pats, and renters downsizing from bigger houses into city flats, investors were now coming back into the market as new tenants replaced those lost overseas as lockdown began.

First-home buyers were also coming into the market, he told OneRoof.

"People are getting used to apartments as a real option, it's ideal living. Gone are the days of having a backyard; we're more like Sydney or Melbourne where the first home is always an apartment. We're coming to terms with that."