On Wednesday 15th August 2018 the Overseas Investment Amendment Bill was passed in to law. From October foreign buyers will be banned from purchasing existing homes in New Zealand, which will in theory help kiwis get on the property ladder.
It has been no secret that it has increased in difficulty to get on the property ladder in Auckland. It is also no secret these sorts of articles are polarizing but bear with us. Many people who live in Auckland do genuinely wonder if they will ever be able to afford to buy a property in Auckland. With the passing of this bill, we believe the answer is yes*
*with a disclaimer of course.
We all know the saying ” always the bridesmaid and never the bride”. It is time to consider Auckland’s bridesmaid suburbs – perhaps not your first choice but they have a lot to offer!
“Affordable” houses in Auckland seem to be considered at $650,000 which in my mind isn’t really affordable at all, this article looks at existing properties priced below this. Assuming you have saved a deposit or have a bit of help (perhaps a guarantor or even able to negotiate a lower deposit), let’s say you have a $100,000 deposit, you could potentially afford a $500,000 house. With current lending at 20%, let’s say you secure a mortgage at 5.5% secured for 3 years your minimum repayment would be $457 per week. How much are you paying in rent currently?
Affordable houses in West & South Auckland
A quick search (July 2018) on a popular property website for 2+ bedrooms, townhouse/unit/house, freehold Auckland wide yielded 38 results. The majority of these affordable houses were in West and South Auckland.
We spied a 3 bedroom, weatherboard do-up in Mangere East for $449K. Mangere East is a great suburb connected via SH1 and 20 (and 20 mins to Grey Lynn thanks to the Waterview tunnel). There are parks, libraries, a new cafe, Middlemore Hospital, schools, daycare centres and a well connected public transport route including the Middlemore and Otahuhu train stations.
Looking further south to Papakura we spied a $499K freehold property – 2 bedrooms, 2 car parks and 446m2 land area. This property is 2km from the town centre where there is a train station, new supermarket, cafe’s and schools. Also near Clevedon for the weekend markets or checking out the Hunua Falls.
Further south again, a 3 bedroom brick and tile home with a fenced section and rumpus room in Waiuku for $480K. This property was built in the early 2000’s and a short walk to the local college, cafes and medical centre.
West Auckland has less options but options none the less. A freehold New Lynn property with 2 bedrooms is listed for $439K and another for $499K. Both are ready to move in to and have fenced courtyards. Near the recently re-vamped Lynn Mall and train stations, these properties are ideal for first home buyers.
Buying in Auckland
Buying in Auckland, especially a first home is difficult. Fact. However looking further afield from traditionally preferred suburbs can mean manageable mortgage repayments and actually owning a property. Your first property isn’t going to be your dream property, it rarely is. But getting a pinky on to that property ladder will be the first step to your dream home. Sites we recommend you look at for budgeting and interest calculators are:
As mentioned earlier, we understand it is increasingly difficult to own a home in Auckland but looking in these more affordable areas and in an existing property, your mortgage repayments will be more manageable meaning a more enjoyable lifestyle.
TIP: The Government has also recently rolled out a “Warmer Kiwi Homes” insulation grant. If you’re checking out a property in a qualifying area, you could get 2/3 off the insulation (if it isn’t insulated already). Check out more at: www.energywise.govt.nz
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