Why are Auckland’s land prices still going up?
Auckland is famous in New Zealand for many things: the Blues, the Harbour Bridge, the Sky Tower and, of course, high property prices.
But why are land and house prices still on the rise? There are countless contributing factors – let’s take a look at what they are and explore the opportunities they present for property investors and owners.
Going up in the world
2020 saw Auckland’s property prices soar. New Zealand’s most populous city accounts for about one-third of the country’s total house sales and, according to the Global Property Guide, it saw a property price growth of 17.4% over the year. As at February, the average home was worth one-million dollars, and it doesn’t look like it’s slowing down. In fact, in December 3,219 houses were sold – 1,287 more than the same month in 2019.
Spurred on by record-low interest rates, Kiwis took to the property market with a competitive spirit in 2020, which resulted in some of the city’s most popular suburbs rising between 12 and 23% in price within the space of a year – with suburbs like Millwater and Milldale increasing by a whopping 20-24%. And despite these costs, there’s still a high demand for property in these areas – meaning it’s quite probable that they will keep going up.
Victoria Garrett at Knight Frank noted that New Zealand’s property market was booming, and buyers were particularly interested in newer homes. With activity showing no signs of slowing down, Golstruct’s house and land packages are an attractive investment option for anyone looking to capitalise on Auckland’s ongoing growth and secure a brand new home.
The land’s the limit
One of the biggest contributors to Auckland’s infamous property cost is due to the land – or the lack of it. Growing populations and high immigration rates have seen the demand for the region’s properties swell. But there is simply not enough viable land to build on – which is why land costs have risen 73% in the last 25 years. And this isn’t likely to change, since there are complications around rezoning more land for development. This means a lot of potential land doesn’t have the infrastructure, such as power lines and sewerage, to support houses – making what’s currently available very valuable and highly sought after.
This is why Golstruct’s land and property packages are a promising option. We put sections on hold for our customers while we finalise and perfect home designs, so there’s less risk of losing out on Auckland’s limited supply of land.
There’s an appetite for Auckland properties that may not be quenched any time soon. The city’s population is projected to keep growing at an exponential rate, all but guaranteeing the need for new houses. And with Labour’s new property law and lower than ever home loan rates both, there’s plenty of opportunity out there for anyone looking to make the most of Auckland’s steadily rising value.
Check out Golstruct’s versatile build options to discover an opportunity that suits you, or, if you have any questions, reach out to our team.