Christchurch Property Market Undergoing Major Transformation As More Homeowners Want New Builds

CHRISTCHURCH, Thursday 13th October 2016: A leading home building company says recent QV figures showing Christchurch’s property market is “relatively flat” is masking the real truth – that homeowners are shunning earthquake-repaired homes in favour of building new.

Golden Homes South Island principal Pavlos Van Aalst says recent media reports that Christchurch’s housing market is cooling off (with home values only rising 3.5%) are extremely misleading because demand for new homes has never been greater.

“What’s astounding is that the rest of New Zealand think there’s not a lot of growth going on in Christchurch but clearly there is. At Golden Homes we’re the busiest we’ve been in 20 years.

“What we’re finding is people want a brand new home. They are concerned about purchasing an earthquake damaged home that may or may not have been repaired correctly.

Since the Christchurch earthquakes new subdivisions and urban centres have sprung up all over the city, permanently altering the residential landscape. The latest concentration of activity is at Prestons and the neighbouring Prestons Park subdivisions near Burwood.

Prestons, developed by Ngai Tahu Property, has sold out in less than four years and will have around 800 homes once all construction is complete. Ngai Tahu Property Sales Manager for Prestons, John Almao, says two thirds of sections have been sold to the general public and one third to builders.

“Many of these sections have been purchased with insurance settlement money. These people want to buy brand new homes, not old homes. They often keep their old home as a rental but live in their newly built one.”

Meanwhile, demand at Prestons Park is so great that a ballot system was recently used to decide which prospective buyers were successful. Managing Director of Professionals Christchurch Ltd, Colin Lock, says he has never experienced such high demand in 20 years of residential sales across the city.

“In one case we had 12 people who all wanted the same section so we used a random number generator to decide who could buy it.” Prestons Park, developed by CDL Land, will comprise over 800 lots in total which will be released in stages over the next few years. More than 120 Lots have sold to date and demand remains strong,

Both Almao and Lock agree with Van Aalst that a societal shift has occurred in favour of building new homes over purchasing existing ones.

Van Aalst says new homes offer a number of clear advantages and give earthquake-weary residents greater peace of mind.

“People can buy a good-sized section in Prestons Park and build a new Golden Home with three bedrooms, two bathrooms, two living areas and a double garage for a total of $550,000,” he says.

“Every Golden Home is built with ZOG framing and rib raft floors which are a more advanced option than traditional methods. Plus you get a high-grade engineered foundation, double glazing, all the latest technology and a full warranty. Clients get exactly what they want with no earthquake damage. For that price it’s no wonder so many Christchurch homeowners want to build one of our homes.

Tougher insulation standards will also take effect on 1 July 2019, requiring all rental properties to have an acceptable level of ceiling and underfloor insulation. “It can be expensive to retrofit insulation to existing homes which is another factor weighing in favour of new builds,” Van Aalst says.

“When clients can build a new investment property for just 10% deposit with Golden Homes, it makes it a viable option.”

Golden Homes will open two show homes in Prestons Park on the 15th of October (this Saturday) – the first home building company to do so in this new subdivision.

“It’s a great chance for people to come and see what the appeal is for themselves. We expect every stage of PrestonsPark to sell out quickly given its central location and proximity to nearby golf courses, shopping malls and Bottle Lake Forest. It’s certainly a hot new area to watch.”

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