Venkat Raman
Auckland, July 1, 2023
A new company aiming to promote upmarket real estate has been launched in Auckland.
‘Paterson Luxury’ will provide real estate and concierge services to the most expensive properties around the country.
Its Owner and Director Caleb Paterson said that new data from the Real Estate Institute of New Zealand (REINZ) on the high-end market is encouraging and that there is increasing interest from international buyers.
The Institute said that 138 luxury residencies and mansions valued at over $512 million have been sold since the start of 2023 in the Auckland region alone.
A former National Sales Coach in the real estate sector, Mr Paterson and his team are reported to have sold properties valued in excess of $500 million in the last five years.
According to him, about 4500 houses in Auckland could be considered to be in the premium market, each with a minimum value of $3.5 million.
Unique Kiwi insights
“There are some unique insights into the way affluent Kiwis purchase their properties with the upper end of the market operating differently from other segments. Many prefer to remain under the radar and some have property holdings in the hundreds of millions of dollars. Discretion is fundamental and for that reason, we do not have any signage on our vehicles,” he said.
Mr Paterson said that there are two distinct buyer pools within the affluent market.
He categorised those who are extremely busy and want to purchase a home and live without making any modifications as those who like to add their own style and flair to the property and are willing to spend the extra time and money to create something exclusive to them.
“This is also often the case with some of our younger buyers. Our Generation X clients are driving the demand for modern architecturally designed homes,” he said.
Mr Paterson said that there is considerable demand for industrial-looking properties utilising materials such as steel, with architects like Fearon Hay in favour.
“There is also a desire for single-level structures, which means that purchasers can live in these homes for a longer period while enjoying a property that is minimalist and low maintenance. We still see a considerable amount of interest in the large sprawling estates in areas like Coatesville, where there is room for swimming pools and tennis courts which owners often do not utilise but are built simply to enhance the property’s status,” he said.
While viewing properties, upmarket expect to see at least three entertaining areas, four-metre stud heights, multiple bathrooms and ultra-modern kitchens.
“These buyers emphasise privacy and are willing to pay. They want properties that have volume in the main entertaining areas. Purchasers are also keen on outdoor entertaining areas and zones and options to relocate with the Sun throughout the day. There is also a move towards salt water in pools rather than chlorine and of course, these need to be heated,” Mr Paterson said.
The migration wave
He said that a new wave of migration is also driving demand for prestigious properties.
“Around half the interest in these houses is from international buyers who are coming into the country as new residents,” he said and cited the example of an international client, willing to spend $10 million on a property and launch a large business.
“He waited nine months to get an investor visa but was knocked. He then obtained a skilled worker visa in two weeks. He did not have to set up a business,” he said.
Mr Paterson said that there is a significant difference between the Capital Value (CV) and the Property Value at the top end of the market, where property losses are at the owners’ discretion.
“I had a client who wanted a quick sale which netted him $1.5 million less than he could have received for the property. The client told me that cryptocurrency was going ‘nuts’ and hence wanted a three-day auction to generate some cash, which he promptly invested in crypto and made $14 million within six months. Often these high net worth individuals are able to sell one property at what can appear to look like a loss only to be able to capitalise on a bigger or better property or investment elsewhere,” he said.
Mr Paterson said that his company has also launched a concierge service to help time-poor high net worth individuals prepare their property for sale.
“To maximise the return on their investment, we provide advice on the specific needs of the prospective buyers, including what renovations will add value to their property and which will not. We have a client with four children heading back to Europe and she was feeling the pressure of getting her property ready for sale. As part of our offering, we will manage everything from landscape gardeners to builders and even get concept plans for a pool drawn up if that’s what is needed for the property,” he said.
