Eight West Auckland neighbours struck the jackpot when they combined forces to sell their homes to a property developer for $10 million.
By combining their land, the homeowners, six of them on Henderson Valley Road in Henderson, and two around the corner on Border Road, had an enticing plot of land of just under 6500sqm with a desirable density zoning that appealed to developers.
READ MORE: Find out if your suburb is rising or falling
Harcourts agent Aman Gulia, who brokered the deal with Joe Steel, said getting eight owners over the line took some two months. Two home-owners on the corner between the two streets declined to take part.
Start your property search
“The deal was growing in size constantly with more neighbours wanting to get involved. It has gone unconditional for circa $10m,” he said.
“Each owner receiving top dollar for their property and the developer is equally as happy. Eight neighbours [selling] was a bit of a record, but putting deals together with two or three are becoming very common for us now.
“Economies of scale let the developers really ramp up the sites and in turn generate more money in order to buy the site,” he said.
The properties in Henderson Valley, Auckland, span over 6500 sqm with zoning that will allow up to 40 homes. Photo / Supplied
While he couldn’t reveal the developer’s name nor his plans for the site, Gulia said that an experienced developer would fit more than 40 houses on the site, most likely affordable for first-home buyers and investors. The deal settles in six to nine months, allowing the buyer to line up consents and plans to start building.
The tricky part of the deal, figuring out who gets what for the mostly two-to-three-bedroom and one five-bedroom 1960s houses, is based on the size of each plot, which range from 675sqm to 1285sqm according to OneRoof records.
This deal now has Henderson passing the $1526 per square metre barrier, meaning owners got between $1m and more than $1.96m each for their properties. They have council valuations of between $560,000 and $770,000, and the houses will be bowled, Gulia says.
“My developer buyers are moving further west as central property becomes scarce,” Gulia, who earlier focused on Auckland’s Point Chevalier and Mount Albert.
“The price per square metre is going up. In Point Chev in September, you were looking at $2400 per square metre. Now Glen Eden has gone up to $2000 per square metre from $1400 to $1500, that’s the difference,” he said.
Harcourts agents Aman Gulia and Joe Steel, with team member Greer Morris-Clarke brokered the $10m deal over two months. Photo / Supplied
Three of them, all on 675sqm sites, have owned their home since the late 1980s while others bought only as recently as August last year. Owners of two of the homes in 2011 and 2012 paid just $270,000 and $285,000 for their homes, yielding a profit, on paper at least, of nearly $800,000 each.
Gulia estimates that with his team of 15, he works with over 400 developers and almost 80% of the deals are being negotiated off-market.
“The developers are calling me daily asking what sites they can purchase because they understand that my clients, the sellers, are happy getting a higher price but giving a slightly longer settlement. This ensures that everyone’s happy.
“Whilst auction is a great process to get you top dollar, sometimes deals of this size take a bit more finesse and strong negotiation has to happen. Recently we got a price for house that was $200,000 more than they’d been appraised to get at auction,” he said.
Some of the two- and three-bedroom 1960s homes changed hands as recently as last year, others have the same owners since the 1980s. Photo / Supplied
Gulia and Steel’s buyers recognise there is a strong market for new homes in the area as “people who live in Henderson want to stay in Henderson.”
West Auckland development land is also doing well at auction.
This week a property Ray White Manukau agents Candace Williams and Monika Maynard brought to auction sold for $2m under the hammer, twice its 2017 council valuation.
The 822sqm property in Neil Avenue, Te Atatu Peninsula, had a six-bedroom house and two-bedroom minor dwelling, both rented, but was in the valuable mixed housing urban zone.
“My phone [was ringing] off the hook, I had an offer the next day to get the vendor to withdraw [the property] from auction,” Willliams said.
In West Auckland, a home and income on development land in Neil Avenue, Te Atatu Peninsula, sold at auction for $2m, twice its 2017 CV. Photo / Supplied
“We eventually brought the auction forward with an offer of $1.7m and still got $300,000 more. We believe in exposing the property to the market to get everyone a chance to see it.”
There were 50 people through the property and a lot of other agents bringing developer clients, she said, adding that buyers were a mix of developers, investors and even some owner-occupiers attracted by the home and income set-up.
Nine bidders pushed up the price, the eventual buyer was the party who put in the pre-auction offer.
While she’s not sure of plans for the site, Williams said it is common for buyers to buy and land-bank.
“Te Atatu is hotter than South Auckland, it feels like it’s getting more affluent, a lot of people are keen to live there. So even if you pay a high price for land, that value will only go up.”
