18 Jul 18
Do apartments work for First Home Buyers? 5 tips from an Auckland Apartment Expert
I cringe a bit when Baby Boomers think they can solve issues for First Home Buyers by directing them to apartments. As if they hadn’t thought of this before…
Apartments can be a lower price point yes, but barriers to entry are still high as the lending can be difficult!
You can however make apartment living a fantastic option by considering a few simple tips below:
- Size matters – unless you’re a cashed up buyer, look for apartments which are over 40m2, your bank manager will generally be happier with these. Set your TradeMe parameters for minimum 2 bedrooms to filter your results to larger units
- Fringe is the new Central – You’ll find larger apartments in the City Fringe, your bank manager will also prefer fringe apartment to CBD, my personal pick for hot spots to look out for is Eden Terrace, Grafton and Freeman’s Bay
- Tenure is important – leasehold is a great option for some people and in some circumstances – leasehold is NOT a great option for you as a first home buyer – stick with freehold
- Outgoings – get your head around outgoings, they’re different to houses – the main difference is the Body Corporate which you can think of as a Personal Assistant to the building and owners, this PA takes care of communal facilities, maintenance, insurance etc. Your main outgoings with a freehold apartment are rates and body corporate levy – your agent will be straight up with you about what these costs are
- Is the building sound? – Super important question. It’s a question you don’t need to actually ask – more like check. Ask the agent for a PRE CONTRACT DISCLOSURE STATEMENT (PCDS for short) and jump to point 10 which will confirm if the building/unit is or has ever been subject to a weather tightness claim. You’ll need to review the whole PCDS and also previous AGM minutes, but start with point 10.
Once you’ve got your head around these and you’ve spoken to a good broker or lender, let’s take a look at some options! I’m currently working with a fantastic property for First Home Buyers, a massive 77m2, freehold 2 bedroom with a car park in Eden Terrace. More details below.
Happy hunting and sing out if you want to run anything past me!