People paying to be placed on priority lists for home in Tauranga amid unprecedented demand

An aerial view of the new Sanctuary Point development in Windemere. Photo / Supplied

Demand for housing in the region is so strong people are paying to be on priority lists for home builds - and builders say they can't bring house and land packages to the market fast enough.

G.J Gardner Tauranga South owner/operator Shane McConnell said there was "unprecedented" demand for housing, particularly in Pāpāmoa East.

"It is the strongest we have ever seen in this area.

"People are paying a deposit to be on a priority list for when sections become available."

How long the waitlists were depended on how long it took for land to become available, he said.

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Tauranga South owner/operator Shane McConnell pictured with wife Kirsty McConnell. Photo / Supplied

"The biggest constraint is new section releases. In some cases, sites that become available now will not have titles until the end of 2021. Construction will not start until then.

"So clients will not be moving into their new homes until the first half of 2022."

The company had built more than 200 homes in Pāpāmoa East and had 76 under construction or planned.

"Demand is outrunning supply," he said.

"This is resulting in escalating section prices. It is becoming impossible to deliver new homes under the $550,000 Homestart cap."

Classic Builders director Peter Cooney said demand was strong in the Bay of Plenty and nationwide.

"We can't bring house and land packages to the market fast enough. Our build pipeline for the next 12 months is very healthy.

"People want to invest in property and utilise the banks' lower interest rates but the market can't keep up with current demand.

"And with land availability on the decline, the new homes market, in particular, will shrink further."

Classic Builders director Peter Cooney. Photo / Supplied

Cooney said Classic Builders did not offer deposits to hold sections but he was aware people were willing to pay a deposit even before the land, house design and pricing was released.

"Demand is that high."

He was concerned house prices would continue to climb in the Bay "and, with land running out, I don't see this reducing".

Bask, a 23-townhouse development on the corner of Maranui St and Oceanbeach Rd in Mount Maunganui, was also selling fast.

Luke Nobilo, of New Zealand Sotheby's International Realty, said of the 21 units for sale, 16 have sold, two are under contract and only three remain.

"In the current market, which is being fuelled by a lack of supply, developments such as Bask are proving very popular and much in need."

Bare sections as part of the now-completed $5m Beaches at Coast Papamoa development also sold fast.

The development, which will include 23 free-standing homes with a shared central reserve and recreational green space, was completed in December 2018.

Frasers Property development manager Kranish Reddy said the bare sections were released in early 2017 and were all sold within 12 months.

The first homes were built in 2018, he said.

"When the sites were released, the demand could largely be attributed to the unprecedented beachside location and surrounding amenity."

The Bay of Plenty Times this month revealed more than half-a-billion dollars of construction activity was under way in Pāpāmoa East.

Pāpāmoa's population is predicted to climb more than 11,000 to reach 40,339 people by 2028.

Bluehaven Group chief executive Nathan York, at the time, called the area the "hotspot" of the city and that people were paying to be on builders' waitlists.

In the same report, Generation Homes regional partner Lyndon Marshall said people were paying to hold properties.

In May this year, the last five sections of the Bay of Plenty's biggest residential development, The Lakes subdivision, sold five years ahead of schedule.

This month, it was reported nearly a third of 32 luxury apartments of the multimillion-dollar six-storey Vantage development at 359 Cameron Rd had sold, including one of the penthouses.

Bayleys Tauranga's commercial manager Mark Walton told the Bay of Plenty Times that 15 apartments, as part of the Waikareao development on Elizabeth St, were under contract before being marketed.

The newly completed $35m Latitude Residences on Park St achieved record sales with 27 out of 28 luxury freehold apartments selling before its completion.

Selling up at Sanctuary Point

Most sections in a multi-million-dollar residential development in Tauranga sold months ahead of schedule.

About 70 per cent of new home build packages as part of Stage 1 of the new Sanctuary Point development in Windemere sold last year. The remainder sold this year. All 33 were planned to be under construction by the end of 2020.

Willy Bedford, marketing consultant at Venture Developments, said they struggled to keep up with demand.

"There's not enough [house and land] packages for the amount of clients there are out there, which is a real shame."

Bedford said most homes in Stage 1 were around $550,000 and were targeted at first-home buyers.

Bedford said about 130 homes were built in Sanctuary Point once the development was complete at the end of 2022.

Most were three-bedroom, two-bathroom homes and ranged from 120sq m to about 150sq m.

The Sanctuary Point showhome is now open. Photo / Supplied

Business development manager David Williams said everyone who visited the Sanctuary Point showhome, which had recently opened, were looking to buy in Stage 1.

"But these were all sold 12 months ago and we've already sold our next 12 months' worth of work, with Stage 2 and 3 now sold."

Managing director Mark Fraser-Jones said the company had long waitlists with people wanting to secure their home - and fast.

"It's scary because you can't get the land to do the packages the market is crying out for."

New resident 'stoked' with first home

First home buyer Aaron Wallis who has bought into the new Sanctuary Point residential subdivision. Photo / George Novak

Aaron Wallis will be one of the first to have his home completed in the Sanctuary Point development.

Wallis said it was his first home in New Zealand and he was "stoked" to have been able to save all on his own.

"I'm in my early 40s and had to put a 20 per cent deposit together," he said. "It was a hard slog to get here but I'm proud of this home I'm building."

Wallis, who works for Carters, said he had been renting in Mount Maunganui before deciding to buy.

"It something so new and different and only about 12-15 minutes from the Mount."

Buying his first home was a "change in lifestyle and a goal", he said.

"I just saw it and jumped on it."

He said he will be moving in with his dog and planned to get a border to help pay the mortgage.

"I'm really stoked. It's a pretty unique spot to be."