Locations > Auckland
Exploding population growth, lagging infrastructure and rocketing costs to buy, develop and build on land. How did Auckland, a city in a small country in the South Pacific become one of the most expensive cities in the world to live in?
Auckland’s property market has been making headlines both here and abroad and rightly so. The statistics from June 2016 show the average house price has reached $992,207 increasing 16.0% year on year and 5.2% over the previous three months. Values as of June were 81.6% higher than the previous peak of 2007 and that fgure is climbing. When adjusted for inflation values rose 15.5% over the previous year and are 54.2% above the 2007 peak.
30 years of poor future planning by the Council has wedged Auckland in a property boom that is driven by high immigration, a severe lack of supply and record low interest rates. Developments simply can’t be built quick enough, whch makes for an exciting time in the region's growth and expansion towards a modern city.
Auckland Council reported that there are 819 new Aucklanders every week. To put this into perspective, the council estimates that:
- 344 new homes are built in Auckland every week
- There is a new street created every two days
- 405 jobs are created in Auckland each week
Rent increases have not kept up with property prices, meaning high yields are hard to come by although the huge demand and lack of properties has resulted in great capital gains and your odds of an extended vacancy period are minimal. Good returns can still be had, particularly with investors willing to be creative, while buy and hold is a viable strategy as the city adapts to the stunning population growth.
|Population||1,493,200 (2013 Census)|
|Forecast Population||2,010,500 (2033) and 2,229,300 (2043), source Stats NZ|
|Tertiary Education||The University of Auckland
Auckland Univeristy of Technology
|Main Industries||Food & Beverage, Information Communications Technology, Tourism,Construction and Engineering, Manufacturing, International Education, Marine|
|Ports and Rail||Ports of Auckland
|Public Transport||Auckland Transport Bus, Train or Ferry|
The Auckland Unitary Plan
To be added...
The Different Areas
Auckland City CBD
The CBD area is dominated by apartments with a mix of sutdent and investor rentals with "central lifestyle" properties. CBD apartments are attractive for investors for their strong rental damand and higher rental yields. A number of new developments are in the pipeline and for investors Dual Key apartment options are starting to prove popular. When considering an apartment check the title of the land and the age of the building. In the past water tightness issues have caused major headaches for apartment owners, however building standards have been significantly improved in recent times.
Mt Albert, Kingsland, Newmarket, Parnell and Ponsonby have seen changes recently with more apartment developments being produced. These are sought after suburbs for home owners and tenants due to their proximity to the city and entertainment areas of Ponsonby, “K road” and Eden Park. These areas reflect their proximity in their price.
West Auckland has always been a popular investment choice, lower prices than central and a strong rental demand makes yields more attractive. Suburbs along the Western train line are generally good options. These include Avondale, New Lynn, Glen Eden, Henderson and Swanson. Te Atatu is also popular and improved transport links out west will open up this region with further population growth predicted. Multi-income properties are the common strategy to get good yields, either by converting and existing property or buying an investment where the work is already done. Make sure you check any work or planned projects with council first.
North West Auckland
Near the end of SH16 you come into Massey, West harbour. Massey and Royal Heights have traditionally been a high rental area and with a lot of 80’s Keith Hay style "box" homes, an abundance of renovation opportunities exist. West Harbour has a higher home owner rate and tends to be segregated into New and Old West Harbour, Old West harbour comprises of a similar 80s houses as Massey and New West Harbour a higher proportion of 90’s plaster clad homes, which you need to be careful when buying because of perceptions of weather tightness. Hobsonville has made headlines after the conversion of 167ha Air force base into a sustainable government Special Housing Area comprising of 4500 townhouses and apartments. This area has seen huge capital gains and a demand that doesn’t seem to be diminishing although prices are nearing seven figures.
South Auckland has always been a popular investment choice, due to its stronger yields, lower prices and good tenant demand. Suburbs along the Southern train line are a good option, as along with being attractive to tenants you’re also future proofing against Auckland population growth and the increasing traffic congestion situation. The main suburbs along the train route are Otahuhu, Mangere East, Papatoetoe and Manurewa.
Anywhere in proximity to the Manukau CBD and Southwestern Motoway (20) are also popular due to easy access to the airport and soon to be Waterview connection.
Generally the closer to the Auckland CBD you are the higher the price expectation will be. With prices skyrocketing over the previous few years many home buyers have started purchasing in areas such as Mangere East and Papatoetoe and even further south to the likes of Weymouth and Manurewa.
The typical housing is ex state on larger freehold sites giving options for future potential development.
Properties on the shore have seen drastic capital gains leaving most of Auckland let alone the country running to hide. New developments are on the rise with apartment buildings being built in Takapuna and Albany. The reasonably new kid on the block is Albany which in just 10 years has gone from farm land to massive infrastructure upgrades, Westfield opening a large mall and a Massey university campus alongside QBE stadium. This makes a great area for both student accommodation and home owners for people taking up jobs outside the CBD to avoid the traffic. Other sought after investment areas include Unsworth Heights, Glenfield and Birkenhead.
Auckland Current Listings
2 Bedroom Apartment
Kea Mews Development, Christchurch
3 br / 1 ba
7 Waiari Road, Conifer Grove, Papakura, Auckland
Dual Key (1 or 2br unit + studio)
The Verve, 48 – 52 Peterborough Street, Christchurch
3br Dual Key from $709,000, incl car park. Other configurations available.
How to Invest in Auckland
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