On August 15 the Auckland Council passed the Unitary Plan, a vision for our city's future. This is the largest plan of its kind since the Resource Management Act 1991, and promises to greatly alter the landscape of Auckland.
This was the largest plan of its kind since the Resource Management Act 1991.
The changes it enacts will have vast implications for those who already own as well as those looking to buy an investment property in Auckland. But what's the story?
Let's have a closer look at the plan itself, and predict the way it may affect a few segments of the property market going forward.
Rezoning affecting land values
Several areas around Auckland including Orakei, Parnell and Kohimaramara have been rezoned as 'mixed housing suburban zones'. This means that they will be open for intensification, boosting housing supply in key parts of the city.
These changes could greatly benefit those who already own property in the affected area as it they could instantly increase the value of their land. This might also open up home owners in affected areas to the possibility of further developing their properties to maximise the use of their land and the profitability of their investments.
If you're unsure whether your area is affected or how to make the most of this opportunity a financial advisor can guide you in the right direction. Making the most of these changes and the opportunities they might present could be the key to ensuring your financial future is a bright one.
Growing regions will emerge
The word of the day with the Independent Hearings Panel and the Auckland Council was 'affordability'.
The word of the day with the Independent Hearings Panel and the Auckland Council was 'affordability'. In fact, the plan's rapid rate of dwelling construction, rezoning and densification are all purposed to help provide Aucklanders with affordable housing (among other things).
If developers and construction companies build to the capacity that the Unitary Plan allows, the Independent Hearing Council predicts that supply will exceed demand by 2041. This will mean a staggering 422,000 dwellings have been built – an amount that will exceed demand by a total of 22,000. If this goes through it could eventually cause a decrease in prices, an eventuation that generally isn't favourable for investors.
However, certain areas may remain solid as they rapidly develop in line with the plan's recommendations. These include Papakura, Pukekohe and Takapuna – all of which have been zoned for increased densification and development as urban centres, according to Unitary Plan zoning maps. As they emerge the future of such towns may attract higher demand from buyers, which might identify them as ideal for investment.
Identifying these future residential hot spots will ensure that your investment in Auckland property is sound and reaps the benefits you expect.
Do what's right for you
Investing in in Auckland property may be the perfect choice for you, however due to sky-high prices and uncertainty in the market it might not. When weighing up your options it's essential that you keep an open mind and consider investing in areas outside of Auckland.
While you may be hesitant to buy away from home doing so is emerging as a brilliant option – we've been having a lot of success in places like Tauranga, Whangarei and Hamilton. Auckland's skyrocketing prices may be placing upwards pressure on these other regions as they're experiencing capital gains at even higher rates than Auckland is.
Wherever you buy it's essential that you go into the property investment journey armed with as much knowledge as possible. Do so and you'll ensure your future financial security and perhaps even an early retirement.
Here's to your financial independence!
Authorised Financial Adviser / Investment Property Expert
Contact us now!