Buyer demographics for inner-city apartments have shifted from house-hunters wanting to live in walking distance to cafes and galleries, to investors hunting yield.
Bayleys residential sales manager, Rachel Dovey, says 16 months ago, many inquiries came from young professionals attracted to the CBD lifestyle. Now more investors are taking advantage of lower prices in the apartment market, combined with lower interest rates.
The romance has moved out to the suburbs, and the hard dollars have moved into the CBD.
"Three years ago, buyers were basing the value of an apartment on emotion - they fell in love with a property, how close it was to the bar scene or their place of work.
Now they are basing value on financials - price, rent, occupancy and debt servicing.
Investors are getting around $450 a week for a 75sq m inner-city apartment, while properties under 50 sq m are becoming harder to finance - and harder to calculate long-term revenues from.
The amount investors spent two or three years ago for a 40 sq m "shoe box" can now buy a 75 sq m apartment with greater rent.
City romance comes to an end
Photo / Janna Dixon
AdvertisementAdvertise with NZME.
