Expensive apartments selling fast
New apartments costing more than $1 million are being snapped up on the western side of Christchurch's central city but more affordable developments are yet to hit the market.
Real estate agents say the outlook for residential development in the CBD is positive but so far it has been smaller, upmarket developments instead of larger, more affordable apartment blocks.
Harcourts agent Alison Aitken said it was "still early days but the demand is definitely there".
"It's just a case of having buildings to put people in," she said.
Aitken has the One Eighty complex in Peterborough St, high-end townhouses in Peacock St and the Housing New Zealand mixed tenure development in Manchester St on her books.
Only four apartments out of 12 were were still available in the One Eighty complex and most of the Peacock St townhouses - between Durham and Montreal - had sold for more than $1.15m before construction was completed.
"People want to be in the city centre, especially around the Durham St-Victoria St precinct, because that area has taken off."
She said larger, cheaper complexes were needed to encourage investment and spark the rental market.
"There are a few projects planned in the $400,000 to $500,000 range and they will be attractive to investors."
She expected the Christchurch Central Development Unit's (CCDU) eastern frame would encourage residential development on the eastern side of the CBD.
Boss Construction is developing three high-end apartments at 435 Durham St, near Bealey Ave.
One had already sold for more than $1.1 million and company director Guy McKee was confident the other two would soon follow.
"The western side of Colombo St is being developed a lot faster than the east side because people are drawn to Hagley Park and Victoria St."
Mark O'Loughlin, of Harcourts, said three of the architecturally-designed apartments in the Dorset Street Apartments complex, scheduled for completion in November, had sold "off the plans for between $1.39m and $1.55m".
"All three are owner-occupier - one [buyer] is coming off a lifestyle block and another is a professional business person and another is a retired businessman."
O'Loughlin said there was good supply and demand for high-end properties. But the demand from investors wanting to buy in the lower price band had not yet been satisfied.
"I think we're over the hump in the CBD and there are a lot of great plans out there but they've got to stack up financially."
Four apartments in Gloucester St are up for sale and the property listing states the developer's goal was to buy in a location "close to where governments and authorities are investing capital . . . before it experiences a lift in capital growth".
Harcourts real estate agent Paul Middleditch said there had been "strong inquiry" about the new apartments, in the Gloucester St block between Fitzgerald Ave and Stanmore Rd.
"If you get into the Conference St or Peacock St area [near Victoria St], you're in the $1m plus market . . . [the Gloucester St townhouses] are a lot more affordable and they're the same product."
However, Christchurch Budget Service chairman Don Johnson did not believe people, especially lower-income earners, thought of the central city as somewhere viable or affordable to live yet.
CCDU general manager of design and planning Don Miskell said he expected "empty nesters, young professionals and students to be the first movers" once development in the eastern frame started.
It was hoped 12,000 people would be living in the central city by 2020 and 20,000 by 2040.
Meanwhile, the Italian architects behind the winning design for the Breathe Urban Village competition are working on a sound financial plan to ensure their project can go ahead.
Federico Anselmi, from Anselmi Attiani Architects, said: "The optimisation of the feasibility can be achieved by different ways - the low cost of construction, by using the processes of prefabrication, and offering high-quality housing."