A tired three-bedroom home in Auckland’s blue chip suburb of Orakei sold at auction this week for $2.636 million – $136,000 more than what the vendor paid in November 2020.
The seller of the 875sqm property on Grace Street, Orakei, marketed by Barfoot & Thompson agents Coco Wang and Bruce Holmes, had intended to build a big 550sqm Grand Designs-style dream home but Wang told OneRoof they now plan to use the money from the land sale to build somewhere else.
The agents’ marketing did offer draft building plans for the huge home, but Wang and Holmes pitched the original three-bedroom home with views across Hobson Bay, on a site zoned for urban density, as a development opportunity, saying there was no way to over-capitalise in the premium neighbourhood.
Wang said three bidders vied for the property, with the eventual buyer being an investor who plans to develop the site.
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“They still need to do resource and building consents, so it will be 18 months to two years to be finished,” she said.
“These are all experienced buyers, they’re looking around Remuera, Epsom, Orakei – all the good areas.”
Developers also snapped up a 670sqm site with a run-down three-bedroom weatherboard house on Massey Road, Mangere, with four of them competing at Barfoot & Thompson auctions this week.
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Agent Yolanda Ma said she had 20 developers interested in the property, which is zoned for urban density and already has resource and building consents for six units.
The hammer came down at $1.03m – $30,000 less than what the vendor had paid for the property in July 2021 as the market was heating up, and just over its $1.025m CV.
“These buyers are looking at similar properties all over Auckland,” Ma told OneRoof, adding they were very experienced and have the capital to begin building immediately.
An artist's impression of what the vendor had tried to build on the Grace Street site. Photo / Supplied
The Grace Street property has clear views of Auckland's Orakei basin. Photo / Supplied
Another pair of properties on Ramillies Place, Glenfield, two houses on a 1874sqm site, passed in at auction at $3.05m, but Barfoot & Thompson agent Babu George said negotiations were underway with the bidder and the property will be sold for more. The properties had a combined CV of $3m, with the vendor having bought the pair a couple of years ago, George said.
The site came with resource consents and concept plans for 13 townhouses, with the agent pointing out the properties could earn $78,000 a year in rent while the buyer got ready to build.
After holding back for the past year, cashed-up developers are now ready to pick up projects abandoned by others.
Harcourts agent Aman Gulia said he has a “crazy number” of buyers looking for project sites they can take over and finish, but not enough stock.
A run-down three-bedroom home on a development site sold for just over $1m at auction this week. Photo / Supplied
Some of his sellers would prefer to sell quietly off-market, he said, because they have other developments finishing and don’t want the market to see they’re selling at a loss the land they bought at the peak.
“I’d get three or four calls a week from people who want to take over the project and finish. Depending on the project, some of these will be good prices because the vendor doesn’t want to go to a mortgagee sale.”
Gulia, who in July inked nearly $25m worth of deals, said that after a quiet couple of months for sites (his sales were mostly for completed townhouses), listings for August and September are “crazy”.
“I’ve got nine sites, from 800sqm to 2000sqm in Milford, Northcote, Birkdale and across Mount Roskill, Panmure, Glendene and Sunnyvale.
“Prices are picking up. I have an 800sqm site in St Heliers looking for $3m, whereas four or five months ago that would have gone for $2.6 to $2.7m.
“Buyers have cash and they know the market will change, some have guaranteed sales of the finished townhouses through government channels or investment companies who buy on behalf of their clients.”
On Auckland’s North Shore, Gulia closed a deal for a modest four-bedroom 1960s house on Lanark Street, Milford, on the market for the first time in 60 years, for $2.85m.
Developers paid $2.85m for a house on Lanark Street, Milford, on the market for the first time in 60 years. Photo / Supplied
He said there were multiple offers for the home on a 1449sqm site zoned for suburban density, with buyers drawn to the great location and zones for Westlake Boys and Girls high schools. It’s CV was $4.41m.
He sold other development sites in Wattle Downs and Massey for between $870,000 and $955,000 while a trio of neighbouring sites on 2650sqm on Hilling Street, Titirangi, fetched $3.775m – $150,000 above CV.
“We are seeing buyers come back, open homes are having really good results. And the developers are coming back to buy larger or adjoining sections.
“June and July were record breaking with close to $50m in unconditional and conditional contracts. The last time I sold this much was in the 2021 peak timeframe,” Gulia said.
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