Lixing’s property picks: compared with Auckland’s cheaper suburbs, is an established area like Parnell still worth an investor’s money?

Barfoot & Thompson recently released its latest sales figures. Although many parts of New Zealand remained under high Covid alert-level restrictions, October trading figures were still excellent, with a sharp rise in new listings, strong sales volumes and steadily rising prices. Notably, compared with the same period last year, the median sale price rose from $967,400 to $1,150,000, an increase of no less than 18.9%, One possible reason is the strong demand for properties on large sites with development potential, many of which have fetched unprecedented auction prices! Add the Government’s successive policies favouring investment in new housing, and it is hard to see how the market could be anything but hot! So which suburbs currently offer good properties worth investors’ attention?

{ad}

YIJU once again spoke with well-known local New Zealand property investor Liang Lixing.

 

Q: For this edition of Lixing’s property picks, are there any properties for sale that you consider worth investing in?

Lixing: Yes. I recently found an unusual offering in the luxury suburb of Parnell: four waterfront villas, each with its own title, available for sale together. According to Barfoot & Thompson’s website, the property belongs to a family that has decided to sell the entire holding after more than fifty years of ownership. The waterfront land covers 3538 square metres. Three villas were designed by renowned architect Peter Sargisson and offer many design highlights, combining lofty living spaces, beautiful views from terraces, sunny courtyards, spacious rooms, three bathrooms and garaging. The fourth villa, built in cedar, also features lofty open spaces, with a park-like setting and waterfront privacy giving it a distinctive character. The property is superbly located, just a short walk from Parnell’s well-known cafés and restaurants.

Q: Could you explain the advantages and disadvantages of this property in more detail?

Lixing: I would summarise the advantages as follows:

1

The property has a very large land area of 3538 square metres, making it well suited to comprehensive development by a medium-sized or large developer. Such a substantial land bank offers unlimited potential for future capital growth and development.

2

There are four existing buildings ready for tenants to move into immediately, offering good rental income. Spending on renovations could also achieve higher rental returns.

3

The location is exceptional, within the Double Grammar Zone. A large waterfront holding with outstanding sea views and a separate title for each building is a rare find in this area.

Next, let me explain Parnell’s advantages in more detail.

Just 2.5 kilometres from Auckland’s CBD, Parnell is one of the city’s oldest neighbourhoods. Over recent decades, however, it has undergone a remarkable transformation, becoming one of the most popular residential suburbs in the Auckland super city.

Parnell

 

Lifestyle

Despite being next to the central business district, Parnell offers the same tranquillity and convenience as Remuera. It is known for picturesque cafés, diverse art galleries and many renowned specialty restaurants. The popular Parnell village shopping and dining strip is a favourite destination for food lovers. Natural surroundings and cultural attractions complement each other here, with Auckland Domain and the Parnell Rose Gardens also favourites among domestic and international visitors.

Auckland War Memorial Museum: Parnell also has a strong sense of history and is home to Auckland War Memorial Museum. Whether you come to admire the impressive building or explore its engaging exhibitions, it is a great destination for residents of all ages. Best of all, admission is free for all Auckland residents.

La Cigale French Market: voted Auckland’s “best food market” for eight consecutive years, La Cigale brings the flavours of Paris to Parnell and is worth returning to every weekend!

Parnell Baths: enjoyed by locals for more than 100 years, Parnell Baths is home to New Zealand’s largest saltwater swimming pool, along with spa pools, and remains a local favourite.

 

Transport

Close to Auckland’s CBD and the bustling commercial centre of Newmarket, Parnell has excellent transport advantages. Britomart and Newmarket are each just one train stop from Parnell. For travel to other suburbs, the InnerLink, OuterLink and route 755 buses provide connections.

 

Schools

Parnell and its surrounding areas offer several state and private schools to suit different families’ preferences. These include:

• Parnell District School – Saint Stephens Avenue.
• Auckland Montessori Primary School – Glanville Terrace
• ACG Parnell College – Titoki Street (private).
• Parnell is also in the highly sought-after Double Grammar Zone for Auckland Grammar School, for boys, and Epsom Girls Grammar School, for girls.

 

Now let us look at the disadvantages:

1

Although the site is large, it is not particularly level and will require a developer with substantial resources for future development.

2

The future buyer will need relatively strong cash flow, as rental income will not cover future mortgage payments. Some renovation could be considered to double rental income.

3

The property currently has no tenants. However, with existing homes designed by a renowned architect and an excellent location, finding new tenants should not be difficult. A buyer wishing to begin development immediately could also proceed without waiting for tenants to move out.

Alongside Liang Lixing’s comments in this edition, YIJU New Zealand has invited architectural planner John Yan from design consultancy Envivo and JOJO, a well-known contemporary New Zealand practitioner of Chinese destiny analysis and feng shui specialising in Xuan Kong feng shui and Zi Wei Dou Shu. They will offer professional interpretations of the property from planning and architectural feng shui perspectives respectively.

 

Q: From a planner’s professional perspective, what should be considered when developing this site?

John Yan: I note that the existing homes are accessed via the shared driveway between 96A and 98–106, running east from Brighton Road. If the number of homes increases, approval to use this shared driveway may need to be sought for 96A Brighton Road. The site slopes down from north to south, with changes in elevation. The Coastal Marine Area (CMA) adjoins the southern boundary, while Hobson Bay Reserve lies to the east at 2–30 Shore Road. Under the Auckland Unitary Plan, the site is currently zoned Single House. It is important to note that it adjoins Hobson Bay Reserve and is in a Special Character Area. Relevant planning and development standards, such as height in relation to boundary and site coverage, will determine how future homes can be designed. Before design work begins, I recommend having a civil engineer prepare a feasibility proposal for future development. Before applying for resource consent, I also recommend relevant assessment reports to establish how best to maximise the site’s development potential, such as the number and size of homes that could be built, while ensuring appropriate environmental effects. With sound planning and assessment to identify the most suitable development scheme, I believe this site’s potential for future capital growth is unlimited!

 

Q: From a feng shui perspective, how would you assess this property’s potential?

JOJO: As the old saying goes, encountering water brings prosperity. Facing the sea, this site has enormous potential. I am very optimistic about the substantial value future development could bring, but the following points also need attention:

1

As well as avoiding unnecessary adverse landforms in the site plan, care should be taken to prevent unwanted effects from hidden corners. Subdivided lots should avoid knife-like or triangular shapes wherever possible, as these can readily create common adverse feng shui configurations.

2

The site is exceptionally well positioned near a water inlet, facing the sea. In feng shui, water is associated with wealth, and the adjoining seawater can improve residents’ financial fortunes. In the approaching ninth period, the Ling Shen position lies in Kan, to the north. If the homes’ orientation is planned favourably, this can bring even greater good fortune.

3

A home with a view of seawater is auspicious, and the water here is tidal. Making the most of it requires careful work on the homes’ internal layouts. Auspicious stars need to fall in the direction of the seawater to activate their power and stimulate the homes’ wealth energy.

 

Q: What investment and development advice would you give prospective buyers?

Lixing: I recommend upgrading and renovating the interiors to attract quality tenants and generate more cash flow, while holding the land for the future. Finding another sea-view property with around 3000 square metres of land in Parnell will be virtually impossible. I therefore suggest preparing an assessment and plan to identify further opportunities to add value.

 

Q: Previous editions of Lixing’s property picks have recommended cheaper suburbs with capital growth potential. Is a premium suburb like Parnell still worth buying into?

Lixing: In my view, risk and opportunity always coexist. Start with your investment budget. If you can afford a high-value property in a desirable inner-city suburb like Parnell, a site this large is certainly an exceptionally rare investment opportunity. Remember, desirable suburbs always rise the fastest and fall the slowest!

YIJU reminds readers that tenders for this property close at 4:00 pm on 30 November, unless sold prior.

Interested readers can visit https://my.matterport.com/show/?m=d4HrazFZbrU for a 3D virtual tour or https://youtu.be/oDQ-HdsZZAE to watch the YouTube video.

 

Alternatively, contact the property’s B&T sales consultant

Eddie Zhao 

Mob：027 288 0188  WeChat ID: eddiezhao00

for more details.