Aucklanders eye apartments

By Ellen Irvine

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Aucklanders looking for value for money are helping revitalise the Tauranga apartment market which crashed during the global financial crisis.

Agents say interest is slowly returning to the market - partly because no new apartments are now being built.

Ross Stanway, chief executive of Realty Services, which operates Eves and Bayleys, said apartments which were well constructed and good value for money were now selling.

He believed it was the start of a turn-around of the apartment market, which was hardest hit when the property bubble burst in 2008.

Buyers were local residents and Aucklanders looking for investments in other regions as Auckland prices continue to lift.

People were buying apartments for holiday homes as well as rental properties, as investors return to the market.

Simon Martin, managing director of Harcourts Advantage Realty, was also confident about the future of the apartment market, despite it taking the biggest hit - a 15 per cent drop - in last year's council revaluations.

Sales had increased "substantially" this year compared to a previous very low level of sales.

Mr Martin believes that trend will continue, as there are no building consents for new apartments in the next five to seven years - creating a demand for already existing properties.

"Essentially there's going to come a day in years to come that there's going to be a lack of supply of apartments.

"We will see an increase in value. A few people have realised that, and that if they want to get in, now is the time."

An increase in apartment sales is not yet matched with an increase in value.

Greg Purcell, franchise owner of Ray White Realty in Mount Maunganui and Papamoa, said there were plenty of apartments for sale.

There had been more interest in apartments as there had been increased interest in all real estate.

Apartments sold last year but mostly for less than $650,000. Top-end apartments had not sold well.

"People willing to part with their money are having a good look around."

QV Tauranga valuer Paul Thomas said values dropped dramatically for apartments as demand died, and had not increased in the past year.

Sixteen apartments at prominent Mount Maunganui apartment block - The Pacific - are for sale by receivership.

The Tauranga market is in contrast to Auckland, where the level of sales is almost back to before the global financial crisis hit.

- Bay of Plenty Times

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