Apartment buyers looking for discounts as interest rates spur more sales

The interest rate cut has spurred on apartment buyers from first home purchasers to investors, according to Australia’s biggest private developer of apartments.

Iconica is one of the towers Meriton is developing on Queensland’s Gold Coast.

The long-mooted interest rate cut has spurred on apartment buyers from first home purchasers and downsizers to investors, according to Australia’s biggest private developer of apartments.

Meriton Apartments founder and chief executive Harry Triguboff said talk of an interest rate cut had driven apartment buyers back into the market a few weeks ago.

However, he said but banks were still making it hard for buyers to purchase and governments were still demanding too high a building quality.

“The market started moving up a few weeks ago and the only thing that had changed was there was talk that interest rates were dropping,” the billionaire real estate developer told The Australian.

“Investors started to come back a couple of weeks ago, in a big way. Now if we sell 20 apartments, 10 apartments will be sold to investors, but not the Chinese,” he said.

In the first interest rate cut in nearly five years, the Reserve Bank on Tuesday cut the cash rate from 4.35 per cent to 4.1 per cent, after 13 successive interest rate increases.

Mr Triguboff said buyers were now however more savvy and looking for bargains.

“There is now a new mode they (purchasers) like to haggle over minor amounts. They feel very clever if they can get a bit of a discount and sometimes they do,” he said.

“We are talking one, two, three per cent off the cost of the apartment. It’s not 10 per cent off the price,” Mr Triguboff said, adding that he was sometimes allowing these discounts across his apartments in both Sydney’s metropolitan and Gold Coast areas.

In other differences he said downsizers were now buying three and four-bedroom apartments whereas before they preferred smaller ones.

“They never bought apartments of this size before,” he said.

Iconica on the Gold Coast is being developed by Meriton

Asked if the interest rate cut would spur him on to develop more of his many vacant sites he holds across Sydney and south east Queensland Mr Triguboff, who is about to turn 93, prevaricated.

“I was never concerned about the amount of interest being charged,” he said.

“The banks make it very difficult for people to buy, it can’t go on.

“The government must decide how much housing they want to produce.

“They don’t ask how much it costs to build apartments. They are lazy.

“This is the main problem, all the time they want do everything better. I assure you Australia has the best apartments in the world. They don’t take into account what people can pay.”

Meriton, which has developed more than 80,000 apartments, is building two towers on the Gold Coast including Cypress Palms in Surfers Paradise with apartments in the tower, billed as the tallest on the Gold Coast, starting at $830,000 for a one bedder with a multi-purpose room. Two bedders start at $1.15m and include a car space.

One bedders in the Iconica tower on the Esplanade nearby start at $838,000.

Originally published as Apartment buyers looking for discounts as interest rates spur more sales