Apartment sales are running hot, so how can investors get a good deal? Aaron Tunstall has some tips.
PRICES IN AUCKLAND are up, but listings are down – this is most definitely a sellers’ market, for both houses and apartments. When you’re looking for a new investment apartment, you’re competing against both passionate home-buyers and dedicated property investors. Both sets of buyers move surprisingly rapidly, particularly full-time investors, finders and property traders, who are sometimes in contact with our agents daily to get the latest.
It’s especially difficult to compete with full-time property people: They move like lightning, they don’t always need to view a property before making an offer, and they don’t need to sneak out of work to attend an auction. So how can the ordinary part- time investor secure a good deal in a fast-paced sellers’ market?
The main difference when it comes to buying apartments is that, unlike residential properties in New Zealand, apartments in a single building are all much alike. Know one and you (more or less) know them all. That means you can run all your numbers on an apartment in advance, set up your buying limits on each building and be ready to bid at a moments notice.
TIPS FOR SMART BUYING:
- Identify the buildings you want to buy in. You can’t keep up with the professionals if you need to start from scratch on every new apartment. Figure out which buildings have the kinds of apartments and price ranges you’re interested in. Because of the amount of research involved, choose a maximum of six buildings. Then…
- Do your reading before you start thinking about individual apartments. Ask for the pre-disclosure contract (also known as Form 18), the AGM minutes and the long-term maintenance plan. If you are serious about investing, read all these. There are hundreds of pages of details. But it is essential. If there’s anything amiss with any of the buildings, you will find it in the paperwork. You’ll need to be up-to-speed on every building in which you’re considering investing. If you’re feeling cash-rich and time-poor, get your lawyer to do it for you.
- Know the market rents. Once again, you need this information before you start bidding at auction. You can use the rental statistics feature on the Impression website (www.impression.co.nz/stats), and also talk to agents – don’t simply rely on what a selling agent tells you.
- Be straight with agents. In a buyers’ market, you may be able to play coy and let the agent chase you. In this market, you’ll simply miss out. With so many other interested buyers, the agent will always make the first call to the people who are friendly and co-operative. Whenever you talk to an agent who sells apartments, explain what you’re looking for and provide all your details. Let that person know you will be making a quick decision and you have your finances in order. That way, the agent is likely to call you when they get a new apartment listing that fits your criteria. If you are the first one in, you can make the first offer and give yourself the best chance to get the deal.
- When an agent does call you, answer your phone and make an appointment to view the apartment. If you ask the agent to call you back, most of them will, but you may have already missed out.
- Unfortunately, this means you need to be available. You can’t expect the right property to wait until you’re free at the weekend or after 6:30pm. Properties most often sell before lunchtime, so when you’re in serious buying mode, be ready to jump in your car and go for it.
- When you’ve found the apartment you want, make an offer immediately. Do your best to put as few conditions as possible on your offer to make it as appealing as you can to the buyer. Call our sales team if you’re struggling; we’re always happy to help.
Impression Real Estate Ltd