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  1. #1
    Join Date
    Oct 2005
    Location
    Auckland, NZ.
    Posts
    621

    Default Ultra High-Spec Auckland Apartment Towers - Firesale approaching?

    These are some seriously fancy digs - they must have had significant pre-sales to get off the ground.
    Pacifica is well underway, International almost finished, Seascape is a massive hole in the ground.

    https://thepacifica.co.nz/


    https://www.seascapeauckland.co.nz/


    http://theinternational.co.nz/

    Similar to expensive buildings in Canadian/Australian/US developments where presale buyers have walked away from their deposits.

    Why buyers are turning away from luxury property | Financial Times

    https://www.ft.com/content/ea9c9abc-...1-2b1d33ac3271

    Jun 26, 2019 - From Vancouver to Sydney, high-end apartments are lying empty despite prices ... Why China fell out of love with New York property · Real estate: ... forced to take over properties and deal with the sales slump themselves.

    In Auckland today:
    This Site to be liquidated at 50% loss - same developer as Pacifica/Park Hyatt.
    https://www.nzherald.co.nz/property/news/article.cfm?c_id=8&objectid=12249814


    Could be first sign of trouble approaching.
    I don't see NZ'ers having the inclination/cash to fill the gap left by foreign buyers.

  2. #2
    Join Date
    Sep 2008
    Posts
    7,575

    Default

    it's a nervy time for developers

    eve apartments on 201 Hobson st. was cancelled a couple of years ago when not enough pre-sales were made

    saba on 136 Fanshaw was also cancelled before being bought by someone else, currently in construction but under a different name?

    st.james apartments on queen st also cancelled due to lack of finance/pre-sales

    alexandra park luxury apartments cost and time blow-outs saw pre-buyers escape from pre-sale contracts

    imho

    a lot, but not all, of the current business uncertainty is due to the unpredictable policies of the coalition gov. and planning rules of auckland council

    their voters/supporters want everything, but expect someone else to pay for it

    in this case the coalition's ban on overseas buyers has, predictably, made it very hard to fund big flash apartments of the quality labour and council demand but kiwi buyers can't afford

    and with all the recent bad building practices coming to light

    we are not at all keen on off-the-plan purchases

    look at how bad panels flying off victopia has made the korean construction industry look

    so auckland will continue to under-build and our housing shortage will remain...
    Last edited by eri; 16-07-2019 at 06:11 PM.
    have you defeated them?
    your demons

  3. #3
    Join Date
    Sep 2007
    Location
    Auckland
    Posts
    8,321

    Default

    SwissKiwi, wow, you haven't posted here for years! Welcome back.

    eri, the overseas buyers can still buy apartments off of plans right? So the FBB shouldn't stop them really? I reckon it'd be the Chinese crackdown on money leaving the country that will be stopping things. That and the easy capital gains seem to have evapourated for nor.

    Yes I agree it's a tricky time to develop though. You'd have to have balls of steel.

    Regarding bad building practices, there's a few high profile ones in Aussie just now aye?
    Squadly dinky do!

  4. #4
    Join Date
    Sep 2008
    Posts
    7,575

    Default

    yes, overseas buyers can buy off the plans

    but then they have to sell as soon as it's finished

    if people know you are forced to sell they can screw you hard, so it's best not to buy in the fist place

    maybe the coalition have changed this policy since first proposing it in 2017, i don't know, haven't kept up as am not a foreign buyer

    but the fact that they propose 1 law in 2017, enact another in 2018?, and keep the right to change it again whenever they like depending on what beneficiaries demand

    is so mickey mouse for long term investments like real estate that most foreign buyers simply park their money elsewhere

    edit

    2017 - The ban on foreign speculators would see only Kiwi citizens and permanent residents able to buy existing homes.
    https://www.nzherald.co.nz/business/...ectid=11936182

    2018 - Now the ban will allow foreign buyers to hang on to apartments bought off the plan, as long as they are part of a development that is 20 or more units large

    Up to 60 per cent of units in new apartment developments of this size could be purchased by foreigners to keep and rent out,
    although the Government could set that limit lower in regulations, depending on market conditions.

    Those buyers would still not be allowed to occupy the unit themselves, but could rent them out.

    National leader Simon Bridges said the ban was "a real case study in bad law-making."
    "This bill will have perverse effects, fewer big housing developments, fewer homes, and that's going to be bad for New Zealand."
    https://www.stuff.co.nz/national/pol...pore-nationals

    2019 - as predicted, apartment buildings get cancelled, due to lack of interest by by unwanted, but necessary, foreign buyers
    Last edited by eri; 16-07-2019 at 11:16 PM.
    have you defeated them?
    your demons

  5. #5
    Join Date
    Sep 2007
    Location
    Auckland
    Posts
    8,321

    Default

    Yeah I actually think there's an exemption you can get (as a developer) as well.

    But isn't it funny how everyone was saying they only make up 3% of purchasers but now sales have fallen off a cliff?
    Squadly dinky do!

  6. #6
    Join Date
    Sep 2008
    Posts
    7,575

    Default

    like the capital gains tax mess

    and the kiwi-build mess

    when the gov. tells everyone it wants to do 1 thing, but ends up doing the opposite

    people just sit on their hands

    i mean wtfigo?


    https://www.abbreviations.com/WTFIGO

    "[International] students couldn't start courses, costing the international education sector $33 million within three to four months."
    Additionally, visitors couldn't make their trips in time and some operators had to cancel tours.
    https://www.stuff.co.nz/national/the...-cost-of-homes
    Last edited by eri; 17-07-2019 at 09:11 AM.
    have you defeated them?
    your demons

  7. #7
    Join Date
    Sep 2007
    Location
    Auckland
    Posts
    8,321

    Default

    Another crap article by Stuff. The headline says:
    The Detail: Government cracking down on visa requirements
    But the article goes on to say how arrivals are still high and there's more residency permits to process than there was previously.

    Processing centre in Mumbai ffs.

    They need to actually deliver on their promise I reckon. They aren't doing eff all about it.
    Squadly dinky do!

  8. #8
    Join Date
    Jun 2013
    Posts
    2,116

    Default

    Quote Originally Posted by Davo36 View Post
    But isn't it funny how everyone was saying they only make up 3% of purchasers but now sales have fallen off a cliff?
    House prices are, to a large degree, controlled by future expectations for house prices, and it only takes a small difference between demand and supply to see house prices skyrocket given the supply of houses is so inelastic.
    So, it's quite possible that the removal of only a small group of buyers can cause prices to tank. That 3% number may well have been correct across NZ, but it almost certainly was much higher in areas of the Auckland market.

  9. #9
    Join Date
    Jun 2013
    Posts
    2,116

    Default

    Quote Originally Posted by eri View Post
    like the capital gains tax mess

    and the kiwi-build mess

    when the gov. tells everyone it wants to do 1 thing, but ends up doing the opposite

    people just sit on their hands
    It is helpful in these situations to understand intent from the actual outcome.

    Labour didn't want to, and had no intention of, building 100,000 houses.
    Labour was never going to introduce a CGT.

  10. #10
    Join Date
    Oct 2005
    Location
    Auckland, NZ.
    Posts
    621

    Default

    SwissKiwi, wow, you haven't posted here for years! Welcome back.
    Thanks - have been very side tracked doing an arts degree and being in Cuba !


    Last time the apartment market crumbled I believe there was only one high end property on the market left flailing - Stanford Residences, which Singaporeans built ontop of the Stanford Plaza. They took years to sell those - kept taking a full page back of the herald property section every weekend. Don't think they dropped the price.

    If they're taking a sales hit with China tightening up credit/foreign buyer rules etc, this time the supply is much greater in that luxury market.

    I can't help thinking there's a reasonable chance of this turning to custard.


 

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