Key Takeaways:
- A South Auckland developer is auctioning a Papatoetoe apartment with a $1 reserve due to financial pressure.
- The developer hopes the auction will help set the reserve for two neighboring properties also being sold.
- The properties, which are tenanted and returning $750 weekly, were originally listed for sale for $874,500 in 2022.
- The auction is a sign that the developer is ready to meet the market and sell the property as soon as possible.
- The high-spec apartment is being pitched at first-home buyers and investors, with features such as electric gates, security cameras, and a big balcony.
Introduction to the Auction
A struggling developer in South Auckland has decided to auction a Papatoetoe apartment with a $1 reserve, in an attempt to stand out in a crowded and sluggish apartment market. The developer, who has been trying to sell three apartments for almost four years, is under serious financial pressure and needs to sell one of the properties as soon as possible. The auction is scheduled to take place on February 18, and the result will help determine the reserves for the two neighboring properties also being sold.
The Properties
The apartment being auctioned, 4/7 Caspar Road, is a high-spec three-bedroom, two-bathroom property with an RV of $790,000. The property features electric gates, security cameras, and a big balcony, making it an attractive option for first-home buyers and investors. The property is currently tenanted and returns $750 weekly, along with the two neighboring properties, which are also being sold. The properties were originally listed for sale in 2022 with an asking price of $874,500, but the developer has since reduced the price to $680,000.
The Developer’s Situation
The developer’s agent, Harsh Kathuria, stated that his client is in an extremely tight spot and needs to sell one of the properties as soon as possible. The developer has been waiting for the market to pick up, but with lending tightening and holding costs mounting, the bank is knocking on the door. The $1 reserve is a sign that the developer is ready to meet the market and sell the property at a price that is acceptable to buyers.
The Market
The apartment market in South Auckland is currently crowded and sluggish, with many new townhouses for sale. However, few of these properties have three bedrooms and two bathrooms, or have been built to the same high specification as the developer’s properties. The developer hopes that the auction will help to attract buyers who are looking for a high-quality property at a competitive price.
Other Developments
Meanwhile, another developer in central Auckland is offering a two-year mortgage-free deal to buyers of apartments in the One Greys Avenue complex. The complex, which was completed in 2023, still has some apartments available for sale, including a two-bedroom, two-bathroom apartment for $1.165m and a three-bedroom, two-bathroom apartment for $1.34m. The developer, John Love, hopes that the mortgage-free deal will help to spark interest in the complex and attract buyers who are looking for a luxury apartment in a prime location.
Marketing Tactics
In Wellington, a real estate agency has used a novel marketing tactic to attract buyers to open homes in the traditionally quiet post-Christmas period. The agency, Lowe & Co, offered a competition to win a luxury helicopter lunch for two at Wharekauhau Country Estate to anyone who attended one of their open homes. The promotion was a success, with double the number of people attending the open homes compared to the same time last year. The agency’s director, Craig Lowe, stated that the promotion helped to drum up interest in the properties and attract serious buyers.
