There’s never been a better time to start a granny flat or small house project and here are my five reasons why:
1. You still can!
Under the current Unitary Plan you won’t be able to build the kind of granny flat (a.k.a. minor dwellings) our clients particularly love. We don’t know exactly when the Unitary Plan will kick into action, but the sooner you get the ball rolling on your minor dwelling, the more likely it is that your plans will get consent. Don’t drag your feet and be caught out. In the meantime, we’re campaigning to keep this style of stand-alone minor dwelling, but will we be successful? There’s no way of knowing.
2. Seriously, these interest rates are fabulous
I’ve been involved with mortgages and finance for most of my career and I’ve never seen home loan interest rates so low. What’s more, they’re forecast to stay low for the next year or so at least. That means you’re borrowing at a brilliant rate during the most testing period of your development project and you’re unlikely to be hit with a huge interest rate rise in the middle of construction.
3. Homebuyers have that twitchy nervous feeling
The Auckland market is off the boil, but almost everyone believes this is only a short-term blip. You can pick up a subdivisible or minor dwelling-able property for less than last year, before prices start to increase again. We’re seeing quite a few excellent properties turned in at auction – vendors still think they can get top dollar but buyers aren’t convinced. There’s an opportunity for a smart buyer to get something at a sharp price; just talk to Steve and he might be able to help you.
4. Rents are on the rise
Rents are at a seven-year high in Auckland and are likely to keep steadily increasing as housing remains relatively unaffordable for first-home buyers. This makes the numbers on a granny flat more likely to create that magical capital gains-plus-yield equation that we know you love.
5. International investors are shying away
Non-resident investors have been blamed for inflating house prices. Rightly or wrongly, foreign property buyers are being targeted by the Reserve Bank’s new requirements and by a new bill designed to “apply GST on cross-border intangibles and services” (are you still awake?). Some believe there will be a flood of Chinese money later this year; others are more sceptical. But given the global economic turmoil and these local disincentives, this could be a golden moment for local buyers and developers.
What are you waiting for? Give us a call, 0800 FUZO LTD (389 6583), and let’s get this show on the road.
By Ammon Acarapi