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Auckland's Top 10 Most Tightly Held Suburbs – it’s not what you’d expect.

John Polkinghorne
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“Tightly held” is an expression you hear a lot in real estate. Agents use it to imply that the property they’re selling in a “tightly held” area or asset class will be snapped up quickly, and you’ll miss out unless you get in fast.

Why would certain suburbs be tightly held? Maybe because they’re popular with owner-occupiers, who tend to hold on to their properties longer than investors. Maybe because they have excellent growth prospects – capital gains are expected to outperform the market, or they give good yields. Or maybe it’s because trading up is too big a jump, so it’s not so much tightly held as “locked in”!

But what are Auckland’s most “tightly held” residential suburbs? The answers surprised us – we think you’ll be surprised too!

Auckland's top 10 most tightly held suburbs (for the last two years):

01.  Otara

02.  Point England

03.  Mt Roskill

04.  Mangere

05.  New Windsor

06.  Panmure

07.  Omaha

08.  Mangere East

09.  Lynfield

10.  Clover Park

This “top 10” list is based on CoreLogic data, measuring the percentage of homes in each suburb that have sold in the last 2 years. Our ranking is based on the suburbs that had the fewest transactions, relative to their size. For these suburbs, 5%-7% of homes were sold in the last 2 years. In a street of 100 homes, only a handful would have changed hands over two years, and months could have gone by without a single "for sale" sign.

By comparison, the Auckland average was 11% of homes sold in the last 2 years, ranging right up to 15%-25% for the top 10 most frequently sold suburbs (which generally have a lot of new homes being built and sold).

So what’s really happening here? Are owners in these “tightly held” suburbs keeping their properties because they’re so sought after, or are they just hard to get rid of? We see a couple of different things going on, and we’ve checked our assumptions against various other data.

There’s a cluster of tightly held suburbs in the southwest part of the old ‘Auckland City’ area: Mt Roskill, New Windsor and Lynfield. They’re all close to the new Waterview motorway, which gave these suburbs much better links to the CBD when it opened in mid-2017. These suburbs saw strong price growth in the years leading up to 2017, as the tunnel opening got closer and closer. This new infrastructure was well and truly “priced in” for those suburbs, and homeowners seem to have been hanging on tight for at least the last few years. These suburbs are also in good school zones: Lynfield College and Mt Roskill Grammar.

On the other hand, owner-occupiers in these suburbs find that it’s a big jump to the next rung on the property ladder – and they can find themselves “locked in”. Just a little closer to the city centre, homes get much more expensive: a jump of at least $100,000 to shift to the next suburb.

Point England and Panmure are quite a different story. They’re all part of the Tamaki redevelopment now underway in Glen Innes. However, while Glen Innes is seeing a lot of new housing being built, and a lot of homes changing hands as a result, Point England and Panmure will have longer to wait until they see the same process. In the meantime, a lot of homes are being held for redevelopment by the Tamaki Redevelopment Company and therefore aren't available for sale. Moving up the ladder from these suburbs is also another big jump, again a case of locked in rather than tightly held.

Omaha is an outlier – literally as well as in the data – as it’s 75 kilometres from central Auckland, and it’s mainly a holiday home area. Demand for holiday homes is very cyclical, and the market can dry up during recessions. We think Omaha’s presence in this list may be a blip in the data, as other holiday home areas in Auckland haven’t seen the same trends. Of course, holiday homes are often seen as somewhere to retire in the future – but most owners are still busy working to pay off the Omaha beach house!

Lastly, we’ve got a cluster of ‘tightly held’ suburbs in south Auckland – Mangere, Mangere East, Otara and Clover Park. We think there’s yet another explanation for these suburbs: they’re all lower-income areas, with a high proportion of renting households. This means many homes are owned by investors. Residential investors have been much less active in the Auckland market in the last couple of years, and that’s partly because of new LVRs (loan to value restrictions), and partly because they don’t expect as much capital gain in the future. These suburbs give some of the best rental yields in Auckland and are some of the most ‘affordable’ for owner-occupiers, but again it’s a big jump if you want to move up the “property ladder” to a more expensive neighbouring suburb, again a case of locked in owner-occupiers.

NZ Best Awards - Judging Underway

nz best

Brought to you by The Designers Institute of New Zealand, The Best Design Awards is an annual showcase of excellence in graphic, spatial, product, interactive and motion design along with four boutique awards.

The judging is in full swing, and the finalists are to be announced this week.

Over the seven days of Judging Week respected design professionals from New Zealand and Australia will judge entries entered into the Best Design Awards. Judges will recognise and celebrate the amazing work from our community that can proudly be measured against the best in the world.

The awards are celebrated with a glitzy industry event at the Viaduct Events centre on September 22nd.

RCGs associate Director, Andy Florkowski, is one of the judges for this year’s Ngā Aho category. The Ngā Aho Award is where the Design reflects a clear understanding of who we are by responding to our indigenous culture, heritage and sense of place. Ngā Aho recognises the collaborative practice of ‘co-design’ between designers and clients and between cultures. Florkowski said that he has been “blown away by the high level and intricacy of cross-cultural collaboration in all stages of the design projects. Everyone is in for a treat when the finalists are to be revealed”.

In the Press

Local Media highlights from the past week...

Kiwibank economists estimate a national shortfall of over 100,000 homes so see no chance of 'oversupply' fuelling a correction; don't believe the RBNZ will be easing LVRs any time soon

Kiwibank economists are forecasting a "meaningful" rise in the house prices into the mid 2020s on the back of continued under-supply of housing that they estimate is about 100,000 nationwide.

They are also forecasting that the Reserve Bank, which eased its restrictions on high loan to value ratio (LVR) lending at the start of the year, will not be in any hurry to further relax the restrictions. 

(Source: Interest)


The business of smart city disruption

Imagine you’re a mayor. Your city is growing faster than you can build the things you need to support the growth, or you’re shrinking and trying to incentivise new industry. Either way, you can’t get the funding you need. Core infrastructure needs replacing, new climate changes rules will make business-as-usual more expensive, you’re being sued for limiting free speech and of course, there’s the traffic. You’re being forced by the government or your staff to consider petrol taxes, environment charges, tourist fees, maybe even a loo levy.

(Source: SpinOff)


'The system is broken': What's wrong with building sector?

New Zealand's construction sector is broken, with decades of financial failure and endangered by fixed-price tendering, a boss says.

Graham Burke, president of the NZ Specialist Trade Contractors Federation which represents thousands of contracting firms, said the industry had deep-seated issues to address after last week's receivership of Ebert Construction, which PwC receiver John Fisk has estimated had debts of about $40 million.

(Source: NZ Herald)


Why are supermarkets all so similar? The science behind the shops

When you walk inside you'll be greeted by a colourful array of vegetables. Then, you'll be led to the meat section against a back wall, the bakery and beyond.

You'll be familiar with this. It's the layout of virtually every supermarket in the country.

(Source: Stuff)

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