Some commercial properties in Auckland are selling for half the price of an average house and providing better returns

This retail unit at Albany on the North shore sold for $585,000, providing a net yield of 5.14%.

Commercial investment property is no longer the preserve of the wealthy, with prices at Bayleys’ latest commercial property auction starting at $545,000, which is about half the price of an average house in Auckland.

Bayleys offered 16 properties at their Auckland commercial auction this week with nine of them finding new owners, giving a clearance rate of 56%.

Prices ranged from $545,000 for a commercial property with development potential in Papakura, to $3.85 million for a modern retail/office building with development potential on Dominion Rd.

The rental yields ranged from 3.59% to 6.16%. And of course those were net yields because the tenants usually pay the outgoings such rates, insurance and some maintenance costs on commercial premises, making the returns far superior to the yields currently being achieved on residential investment properties in Auckland.

Bayleys also auctioned five commercial properties in the Waikato last week, two of them selling at prices that would be within the reach of many smaller investors ($620,000 and $701,000) with the others being passed in for sale by private negotiation.

Colliers International also reports that commercial properties have been selling well at auction, with Auckland properties providing yields that averaged 5.4%.

The details of the latest commercial property sales with photos of all properties including those that were passed in at auction can be viewed on our Auction/Sales Results page by selecting “Commercial Property Sales” in the “Property Type” search field.

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