NZ agents look to win mainland clients

PUBLISHED : Wednesday, 27 October, 2004, 12:00am
UPDATED : Wednesday, 27 October, 2004, 12:00am

WITH THEIR growing wealth and spending power, mainlanders are becoming the new target customers of overseas property agencies.

Premier Capital, an agent specialising in marketing overseas properties, recently presented an Auckland serviced-apartment project, 188 Hobson, at a marketing campaign in Shenzhen.

Associate director Eric Sampson said mainlanders were showing increasing interest in New Zealand as more of them visited the country.

The wealthy in Shenzhen have emerged as potential buyers of overseas property and the 188 Hobson apartments should be appealing to them, he said. The large expatriate population working in Shenzhen were also target customers.

To tap mainland investment, Premier Capital has marketed other overseas properties through promotions in Shanghai. The agent has set up its own sales office in Shenzhen.

The 188 Hobson project, close to Auckland's central business district, has 119 one- and two-bedroom serviced apartments. The Paxton Pacific Group development is due for completion in November next year.

An initial batch of 14 units was launched in Hong Kong last month and sold quickly.

The one-bedroom apartments start at NZ$215,000 (HK$1.16 million) and two-bedroom units cost from NZ$325,000.

Mr Simpson said the project attracted investors looking for good returns and potential value appreciation. A guaranteed 7 per cent net return for the first two years was on offer.

Serviced apartments were appealing to locals and the increasing number of tourists and business travellers to New Zealand looking for short- or long-term accommodation, he said.

He said overseas buyers were interested in New Zealand property because of the lack of ownership restrictions for foreigners buying property and the absence of a capital gains tax.

The tax system in New Zealand was 'investor friendly' and foreign buyers were also impressed by the fact they could buy any type of property without the need to pay stamp duty on the purchase, he said.

Regarding concerns that property prices have peaked, Mr Sampson said he was confident there was room for price growth.

New Zealand's economic growth continues unabated. It grew 0.9 per cent In the June quarter, and GDP growth is projected to close at 5 per cent for the year. The unemployment rate remains at a historical low of below 5 per cent, and Mr Sampson said economic growth was expected to be 3.5 per cent next year.

Despite the possibility of the central bank raising interest rates in the short term to slow inflation, Mr Sampson said the market expected interest rates to ease next year.

Westpac Banking Corporation will lend approved purchasers for the 188 Hobson development up to 80 per cent of the purchase price or valuation, with a maximum term of 20 years.

Mr Sampson said a 15 per cent deposit was required upon purchase, with the balance of property price payable upon the project's completion.

Quest Hotels will manage the units under a 20-year agreement, but owners have the option to pull out of the management agreement at no cost.