A sprawling property in Pukekohe has tripled in value in less than three years.
The near-$6 million sale three years after it was bought for $1.75m is because the land and house sit in a Future Urban zone — and real-estate industry experts predict the next boom areas will be those earmarked for higher-density development. The 18.1ha Pukekohe East Rd property includes a three-bedroom villa.
The owner bought the land in two blocks and sold the villa and its 1,000sqm section for about $450,000. The larger lot was sold for about $5.5m. Barfoot and Thompson agent Ian Croft, who sold the property, said asking prices for some properties in Special Housing Areas could rise by up to 40 per cent.
The areas include parts of Albany, Hobsonville, Greenlane, Otahuhu, Flat Bush, Takanini, Northcote and Papakura and allow for more intensive developments.
Future Urban Zones were also hot property, he said.
But owners wanting to cash in would have to have a good chunk of land to spark interest from developers.
Croft was selling a four-bedroom home on 4700sqm in Karaka, with a council valuation of $1.7m, and said its Special Housing Area status had given the property a huge value boost.
He also sold another Future Urban property on Pukekohe's Golding Rd for $3.2 million. It had previously sold for $900,000.
The Government and Auckland Council introduced Special Housing Areas to release land to developers so more houses could be built in an effort to fast-track the build process.
Future Urban Zones in Auckland — meaning they could be urbanised within 30 years — include rural parts of Warkworth, Silverdale, Whenuapai, Riverhead, Takanini, Karaka and Pukekohe.
Andrea Rush from qv.co.nz confirmed many land values in Special Housing Areas had risen because of the increased development potential.
In March a 70sqm house on 1,017sqm in Fred Taylor Drive, Whenuapai, with a council valuation of $530,000 sold for $800,000.
Two months later another 1,017sqm site on Fred Taylor Drive with a council valuation of $635,000 sold for $1m.
But the value of some smaller properties had dropped because of a lack of development potential.
Figures from Barfoot & Thompson this week revealed the average price of houses it sold in Auckland had dropped for the first time in six months.
The agency said the August average sale price was $821,079, down from July's figure of $827,359.
Managing director Peter Thompson said there were signs that house price increases were cooling in June and July, and August's figures confirmed that winter had contributed to a small price decline last month.
Real estate sales are likely to get another boost after the BNZ cut its one-year fixed lending rate to 4.35 per cent on Friday, believed to be the lowest rate in New Zealand since the 1960s.
Mortgage rates have been falling since July when the Reserve Bank starting cutting the official cash rate.