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Social infrastructure identified as key element to picking Auckland’s next ‘hot suburbs’

Tags: Auckland Property Insight Research Residential

Infrastructure and social amenities are the keys to picking Auckland’s next round of ‘up and coming’ suburbs, according to latest research from Bayleys.

Train stations, bus stations, retail amenities and hospitality hubs have become the key societal factors behind choosing where to live. The research data indicates these have replaced the previous primary property growth fundamental of simply being the ‘next affordable suburb’ in Auckland’s concentric geographic ring – with the centre point being Queen Street in the heart of the city.

Headlining the agency’s picks for 2016’s ‘up and coming’ suburbs across metropolitan Auckland are New Lynn, Hobsonville, central Onehunga, and central Birkenhead.

Bayleys Research manager Ian Little said the agency’s ‘hot spot’ selections were made on forecast capital growth opportunities over the medium to long term, and not rental yield returns which were driven by a different set of financial dynamics.

Mr Little said that picking Auckland’s ‘up and coming’ suburbs was however becoming an increasingly difficult challenge.

“There are very few, if any, ‘bargain’ suburbs left in greater Auckland. Everything has moved considerably up the price-ladder over the past twoand- a-half years. The challenge now is to identify which suburbs will outperform the market in the medium to long term.

“In the past few years it has been the city-fringe suburbs of Grey Lynn, Pt Chevalier, Mt Albert, Greenlane/Ellerslie and Orakei which have recorded substantial capital growth. That was predominantly on the back of Auckland’s concentric city fringe ring spreading ever outward.

“Now however, we are tracking that there is a jump to suburbs further out, with the fundamentals now very much encompassing social amenities and transport infrastructure.” Under that criteria, New Lynn, Hobsonville, Central Onehunga, and Birkenhead came out on top, he said.

“Onehunga for example has long been touted as the next Ponsonby. However, until recently that suggestion was pure fantasy for a multitude of reasons – including primarily that there was a far closer comparison between the likes of Westmere, Pt Chevalier and Grey Lynn, than anything Onehunga had to offer,” Mr Little said.

“The retail heart of Onehunga has, traditionally, also been somewhat ‘less than salubrious’ in its offerings. That is now changing – particularly with Auckland Council announcing plans to transform the nearby Onehunga waterfront precinct into a harbourside hospitality and retail zone meaning locals will no longer have to travel into the central city Wynyard/Viaduct/Britomart areas for a night out.

“The Onehunga Wharf development will complement the $30 million Onehunga foreshore beach and parkland project which opened earlier this year.

“Adding to the bigger jigsaw, there are still a substantial number of ‘do-up’ villas in the lower part of Onehunga which represent considerable add-value buying opportunities, while further to the east there are large tracts of state houses. Those 1940s/50s/60s solidly built homes, usually on large sections of land, are very much sought after by young couples seeking live-in renovation projects inspired by shows such as The Block NZ.”

Meanwhile, over in West Auckland, Mr Little said residential property values still had room for growth in the New Lynn district circled with a one kilometre radius of the train station – encompassing Portage Road to the east, Gardner Avenue to the south, Titirangi Road/Rata Street to the west, and Rizal Reserve to the north.

“Train services from New Lynn to the CBD are among the best in Auckland, and the new Brickworks hospitality precinct in the revamped shopping centre again offers a ‘local’ dining and drinking destination rather than the immediate populous having to head into the central city as previously,” he said.

Further north, and piggybacking off the overwhelming success of the Hobsonville Point master-planned suburb, Mr Little said neighbouring ‘old’ Hobsonville would now benefit from the adjacent social infrastructure built over the past five years – ranging from the new decile-10 Hobsonville Point High School through to the opening of the $15 million 3,860 square metre Countdown supermarket in September.

He predicted the current substantial ‘greenfield’ pastures north of Hobsonville Road - stretching across the motorway connecting West Auckland with the North Shore and then over to the rolling countryside bordered by Brigham Creek Road linking to State Highways 16 and 18 – would be carved up over the coming years and those getting in early would reap long-term benefits.

“Again, it will be social infrastructure and social amenities which will be the key drivers of residential development growth. For example, at nearby Westgate, Auckland Council and New Zealand Retail Property Group (NZRPG) are partnering to build the new regional town centre,” Mr Little said.

“The intention is to create a civic heart at the 156 hectare Westgate suburb - which will eventually include a new 3,500 square metre library with community rooms.

“Some 10,000 new jobs are expected to be created at Westgate supported by 4,000 new residents. Just a few kilometres away to the east, the expanded Hobsonville Village is already under development to sustain new business activities and a small amount of residential housing next to Hobsonville Domain.

“An employment park will be developed between Brigham Creek Road and Westpark Drive on Hobsonville Road with plans to create another 4,000 jobs. An infrastructure upgrade is also planned for Hobsonville Road to accommodate a quality transit network of buses, wider footpaths and cycleways.”

Rounding out the ‘hot spot’ hit-list, Mr Little said that on the North Shore, one of the region’s oldest suburbs, Birkenhead – tracing its heritage links back to the early part of the last century – had remained largely undiscovered by the masses and was consequently ripe for surpassing standard market growth.

He described Birkenhead as being a ‘sleeper’ on the city’s North Shore – long overlooked for the likes of Forrest Hill, Bayswater, and inland areas along the East Coast Bays. In recent years, the cheaper, entry-level environs of Hillcrest, Birkdale, and Glenfield had all recorded considerable rises in average sales values.

“Yet the community-based fundamentals for Birkenhead Central have been consistent over the past decade,” he said.

“It is a main hub for bus services to and from the city to the outer reaches of Beach Haven, Birkdale and Glenfield. There are regular ferry services to and from downtown. And it has a vast array of food and beverage options in the town centre, which is well supported by a very pro-active business association.

“There are multiple property styles in the neighbourhood – ranging from early 1900 heritage villas through to several intensive mid-rise apartment blocks currently under construction and due for completion in the coming 18 months.”

Mr Little said Birkenhead’s potential for servicing a pedestrian-based population rather than those using vehicles for small distance journeys, had been identified by the developers of new apartment blocks being built close to the town centre – including two on Rawene Road facing toward the city, and one in Hinemoa Street.

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