There is no denying it has been a turbulent year to say the least, with uncertainty still looming. But with the property market now booming due to various factors including record low interest rates and those who held their jobs during lockdowns forced to save, there is still much strength in off-the-plan property developments, albeit with a focus in different areas than before.
Due to the pandemic, we have observed the inner-city apartment market fall out of favour. The exodus of overseas students, low rental yields and the requirement to work from home have been the main contributing factors, with city centres being converted to ghost towns during lock down periods. However, there is one market that continues to experience growth and soar to new levels; boutique, luxury apartments in the lower to medium density areas.
There are various purchaser demographics contributing to this growth.
Rightsizing is traditionally the process of a company restructuring or reorganising itself by reducing its workforce, cost-cutting, or rearranging structure (Market Business News – MBN). However, with reference to property, rightsizing is the term used to describe the downsizing trend towards luxury apartment living (eliteagent.com). According to Knight Frank’s Head of Residential Research, Australia, Michelle Ciesielski, rightsizing is not just a baby boomer, active retiree trend. Many younger families, young couples and singles are moving to this more affordable type of living.
Expats are also fuelling Australia’s property boom and growth in this area (Property Investment Professionals of Australia (PIPA)). It is thought that over 400,000 Australian expats have returned to Australia since the pandemic began in early 2020, bringing with them money that was earned overseas (Wood, Mike. “Expats contributing to property booms, says industry body”, Broker News, 7 April 2021, brokernews.com.au). Colliers Residential director, Peter Kerras has stated that expats returning to Australia are buying at the top end of the market and are leading the way of the changing market. These buyers have been used to living in apartments and have been doing it for a number of years, so apartment living is no issue for them, even with families.
According to research conducted by The Knight Frank in 2020 (Rightsizing – Australian Prime Residential Insight 2020), purchasers in this boutique market are looking for low-maintenance properties, but with house-like characteristics. These luxury apartments are in high demand, with two to three bedrooms, large open living areas and a strong focus on luxurious amenities including wellness and rooftops. Purchasers are seeking convenience with easy access to transport, smart and sustainable living technology as well as a strong sense of community and social connectivity – providing residents a way to balance their work and home life and connect with their fellow residents.
The growth in boutique, luxury apartments is real. Developers have been finding opportunities in the current climate to be moving away from large construction projects and towards the more specialised boutique offerings targeting owner occupiers. And owner occupiers are more highly represented than investors in this boutique, luxury apartment niche.
KIN’S EXPERTISE IS MORE IMPORTANT THAN EVER IN THIS GROWING BOUTIQUE, OWNER OCCUPIER MARKET
KIN help off-the-plan developers maximise timely settlements.
Based on our privileged position of being directly involved in over 40,000 off-the-plan residential property settlements, we offer a personalised service like no other, which results in less stress for both the developer and the purchasers and therefore, more timely and profitable settlements.
It is vital that strong relationships with all purchasers are built, that they feel part of the development process and are motivated to settle on their properties.
Whilst KIN excel in assisting all purchasers (both owner occupiers and investors) along their settlement journey, it is generally a more demanding process when managing settlements and the communication process with owner occupiers. Owner occupiers are more likely to exercise more time, care and emotion when purchasing a property than investors. They are more emotionally invested in their purchase. It is not just a financial investment, it is their new home.
KIN experience a lot more involved communication, questions and special requests from owner occupiers. As a result, KIN find that managing owner occupier purchasers takes more time and empathy.
As a team of highly trained and experienced settlement consultants, dealing with purchaser questions, worries and anxieties is a core strength. KIN assist developers by providing a one-on-one personalised service to purchasers; being there for them to answer an avalanche of questions and guide them through the settlement process, saving developers time and minimising their settlement risk.
With every settlement being critical, partnering with the settlement team at KIN provides developers transparency and control without the stress of managing purchasers through settlement.
In addition, our builder’s defecting service has experienced enormous growth in the last year, particularly in this luxury market. Builder’s and developers understand that owner occupiers place even more emphasis on ensuring their apartment is perfect prior to settlement than investors.
Should you wish to connect with us regarding your current or upcoming project, please click here.