Evolving Residential Development Fundamentals Create Opportunities For Property Owners

Real estate experts at New Zealand’s largest, full-service agency say evolving residential development fundamentals have created new opportunities for property owners.

“The government introduction of a series of incentives for new build properties has spurred rapid growth in this sector which continues to yield new opportunities for homeowners as a result of the Resource Management Amendment Bill and changes to tax legislation,” says Suzie Wigglesworth, Bayleys national director of residential projects and general manager for Auckland Central.

Bayleys have recently announced it is adding to its development offerings with the launch of a dedicated New Build team that will provide sales and marketing services for off-the-plan buyers and sellers of small-to-medium residential development sites.

The team strengthens Bayleys suite of offerings for the development market, supporting its established Projects team which caters to larger-scale residential developments of 45 dwellings or more. The team has previously overseen the sales and marketing for high profile developments including Winton’s master-planned Wanaka community – Northlake – in Central Otago.

“Some 100,000 new homes including apartments and townhouses are expected to be sold off-the-plans in the next five years, with our new team born from the growing demand for salespeople and support specifically focused on this evolving market segment,” Wigglesworth says.

Bayleys says landowners, sellers and residential developers nationally will have access to a team of highly trained experts that can aptly communicate development opportunities with knowledge of the dynamic marketplace, financial considerations and feasibility.

“While Kiwis are more understanding and amenable to buying off-the-plan purchasers still need to enter agreements with their eyes open, so we will also provide valuable services for buyers in the new build space,” Wigglesworth adds.

The Government has committed to providing more new housing options with a bill in the works to enable more land parcels within urban areas to be developed with up to three properties of three levels per site without the need for resource consent.

“Legislative and zoning changes and financial incentives are the result of Government emphasis on increasing housing supply at scale and pace, fueling growth in the sector,” Wigglesworth says.

“Sweeping recent changes including the exemption of the removal of interest deductibility against rental income on new builds and the exemption for new builds from the 10 year bright-line test, along with financial legislation which has also changed in favour of buying means Kiwis are constantly seeking guidance in this space,” she adds.

Bayleys says the Government’s initiative to focus investor interests on the new build market is having the desired effect with property investors increasingly moving away from existing housing supply in favour of new developments.

Under central government guidance, any residential developments with the opportunity for three dwellings or more are considered in this context as a new build, and will therefore be managed by Bayleys’ new specialist team.

“In Auckland, locations like the Te Atatu Peninsula, Northcote, Hillsborough and Sandringham are seeing growing demand in the small-to-medium development sector. However, sellers and some salespeople are struggling to keep abreast of changes including zoning that dictate a site’s potential – and ultimate market value.

“Those that are aware, along with residential developers, are coming up against ongoing challenges in a changing market – including legislative reform, financial conditions and developments abroad which play a role in things like construction costs and demand for housing.

“To bridge the gap here Bayleys’ New Build team is positioned to be the expert conduit between buyers, sellers and developers, recognising the strong connection between dedicated expertise and achieving the very best result,” Wigglesworth adds.

She says that selling properties off-the-plans, similar to providing advice about development opportunities is a specialist area of expertise that requires a robust training and accreditation programme.

“This team will be a well-connected network of dedicated experts across new builds and development opportunities throughout Aotearoa,” says Johnny Sinclair, national director of residential.

Sinclair says the New Build team’s development is a natural progression that leverages Bayleys’ existing expertise across its well-established residential, commercial and industrial and country businesses.

“We have a national network of salespeople and support across all market segments offering a level of connectivity that is unparalleled.

“Our established Projects Team are already industry-leading at working with residential developers creating feasibility studies, market analysis, pricing, design, and trend forecasts.

“They also have a professional track record at delivering ground-breaking marketing and advertising campaigns to help set their developments apart,” he adds.

The new division aims to become the number one, go-to for all small, medium and large-scale new build residential developments in New Zealand, and the agency of choice for property owners considering selling a property that is primed for development.

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