Barrett's Blog

Small sections in Pāpāmoa help first-home buyers into Tauranga property market

Sections as small as 200sq m to 300sq m are being sold in Pāpāmoa.

The development of a large area of medium-density housing in Golden Sands has proved a lifeline for first-home buyers struggling to get on to the property ladder.

Tauranga building companies have noticed a boost in first-home buyers aged between 20 and 30 in the past few months, particularly in Golden Sands.

They say a drop in section sizes from 500sq m or 600sq m to about 270sq m or 300sq m had made a big difference for those wanting the keys to their first home.

Barrett Homes had 12 new agreements signed in the past five months for buyers aged 30 or younger, the youngest of whom was 22. The average age of all buyers was 24.

Director Grant Eynon said Golden Sands was normally priced at a level first-home buyers, in particular, could not afford.

However, Eynon said work between local developers such as Bluehaven, SmartGrowth and Tauranga and Western Bay of Plenty councils to build medium-density housing had started to pay off.

“There now looks to be an indication that this work is starting to pay off, with younger generations using these medium-density housing developments to get on the property ladder,” he said.

G.J. Gardner Tauranga franchise owners Kirsty and Shane McConnell said they had experienced a similar increase in interest from young first-home buyers in the past three months.

Kirsty estimated the company had built between 300 to 400 homes in Golden Sands, and the medium-density lots were proving more cost-effective for first-home buyers.

“In the last year, we have built about 38 homes for first-home buyers in Golden Sands.”

Kirsty said many first-home buyers did not realise they were in the running to buy their own home – but a drop in section sizes from between 500sq m to 600sq m to about 270sq m to 300sq m had helped.

“It is like a $100,000 difference, that is all they need to be able to afford it … House prices don’t change but we just needed the land to build more affordably.

Shane McConnell said with the land size being adjusted, people were also changing their expectations of what type of house they wanted.

He said there had been a shift from people wanting four-bedroom homes and double garages to being happier with something smaller.

“We really want to see young people get into their first home and more builders are wanting to do that, too.”

Aerial images of Pāpāmoa’s Golden Sands area. Photo / George Novak

ZB Homes managing director Rik Flowerday said the company had built 30 to 40 homes at Golden Sands in the past couple of years and about 50 to 60 per cent of those were for first-home buyers.

Flowerday said medium-density housing was the way of the future.

“First-home buyers have got their head around smaller houses and smaller sections. It is either smaller houses on smaller sections or we need to look at terraced housing ..,” he said.

“I think it is the future for Tauranga. We have to intensify rather than spread out.”

OneRoof editor Owen Vaughan said Tauranga’s median property size had dropped in the past few decades to 507sq m in 2010 from 607sq m in 2000 and 600sq m in 1990.

Vaughan said medium-density housing had been a feature of Tauranga’s landscape recently and it was

“nothing to be afraid of”.

“Most people are still expecting that quarter-acre dream and it will be a shock to people in the Bay seeing the size of the sections being sold,” he said.

“I suspect what we will need to get used to is smaller section sizes. I think we will be seeing smarter use of space within the smaller sections.”

Bluehaven chief executive Nathan York said the Bluehaven Group had been involved in delivering more than 2300 residential units in Wairakei.

A breakdown of how many homes had been built year-by-year was not available for public consumption, but York confirmed some section sizes were between 200sq m and 300sq m.

York described growth in the Golden Sands area as “exceptional” and said there was a “great blend” of demographics in the area, from younger to older people.

“In particular a lot of families have moved into the area … ,” he said.

“Bluehaven Group in many ways have led the way with medium-density housing on scale.”

York said the modern urban living Excelsa Village in Golden Sands was built more than 10 years ago, and significant housing developments off Te Okuroa Dr had been more recently completed.

“[They are] all medium-density houses and our build partners have bought into this philosophy,” he said.

York said it was “very exciting” to have been part of the growth dynamic and was looking forward to introducing more modern residential opportunities and the new town centre, The Sands.

SmartGrowth independent chairman Bill Wasley said the intensification of existing and future areas for medium-density housing was a way to accommodate the future population increase and housing demand.

“… We have probably seen more of it. It is certainly one of those options that are available for first-home buyers as opposed to the larger traditional housing options.”

First home at 22

Adam Ballantyne (picture above), 22, has bought his first home at Golden Sands in Pāpāmoa.

The Tauranga electrician said it was “a bit of a shock” because he initially had no intention of buying a home. “I kind of thought I never would.”

Ballantyne said he would hear how high house prices were getting and thought, “It is a bit ridiculous”.

“I thought I had to wait until I had a partner and got married and saved a lot of money.”

But the 22-year-old said the idea become more appealing after realising it was something he could afford and knowing having flatmates could help pay off the mortgage.

Ballantyne used his KiwiSaver and HomeStart grants and a bit of help from mum and dad to “bump it up”.

“It is quite intimidating when you look at the total price. But I didn’t realise how easy it was until I started.”

Growing up on a farm in the Waikato, Ballantyne didn’t want anywhere too close to his neighbours so he “shopped around” before eventually settling on a lot in Golden Sands.

He is working with Barrett Homes to build his single-storey, three-bedroom, two-bathroom home with a garage on a 316sq m section.

“It didn’t feel real, it is quite a shock. You get all of the congratulations and you don’t realise what you have done,” he said.

“Then your first mortgage repayment goes out and you think: ‘This is really happening’.”

Ballantyne believed the medium-density housing in the Golden Sands development would allow more people his age to get on to the property ladder.

“I think it will definitely bring down the age of first-home buyers,” he said.

He said the area he had bought in was “full of young people”.

Click here to see full BAY OF PLENTY TIMES Article published 8 Feb, 2020 7:00am