Energy rating and electric vehicle charging on the apartment wishlist: Five Minutes with The Agency's Michael Paproth
The Agency Port Phillip agent Michael Paproth says every prospective apartment buyer he is speaking to at the moment is interested in knowing what the star rating of the building is, or whether there is EV charging.
"Most buyers don’t have an EV but understand that they soon will have," Paproth says, with buyers planning well ahead with their off the plan purchases.
Urban recently caught up with Paproth to discuss the trends emerging in the apartment market.
JC: How have you viewed the performance of the off the plan market in 2021, and what are the strongest positive and negative factors that will influence outcomes in 2022 and 2023?
MP: The off the plan market has been incredibly resilient in 2021. To consider that we threw a pandemic and statewide lockdown and lock out at it shows that Melburnians – the local market – have an insatiable appetite for new, low maintenance living.
The strongest positive factors for this market ironically are the lack of approvals for new development that have slumped and are only showing very slight improvement in numbers which will mean a drastic lack of supply into 2023/24. Coupled with the eye watering construction costs due in part to material shortages to lack of apprenticeships the market will absolutely lap up what little availability there is.
The negative factors that will influence the market are all centred around immigration to and migration out of the state. My hope is that Melbourne will once again be seen as the safest and most beautiful City in the world to come and work and study in. As we open back up to the international students and expats return home to avoid the European winter I think we can expect that demand for new and off the plan will be extremely strong.
If we miss this opportunity then the sector may struggle.
JC: What trend (short term or long term) has prompted your greatest enthusiasm for the apartment market, and what is the issue of most concern to you and or your clients?
MP: The short term trend that I have great enthusiasm for is seeing buyers embrace what they didn’t know they wanted. Melbourne developers have stepped it up in relation to amenity and now buyers are enjoying life in 6 star hotel like accommodation.
The longer term trends are the home as the central hub of entertainment and for work. Work from home is a now a thing and employees are showing flexibility as the pandemic rolls as the risk of a infecting a team or entire office means the flexibility remains. That is translating into studies and spaces for that within residences. We are also seeing things like Chairmans Lounges at Saint Moritz or Vaults at Rondure House which are dedicated, on title work spaces.
JC: Has urbanisation stalled amid the rush to the regions and what will it look like over the decade ahead?
MP: Over 2021 I have sold numerous apartments to families who are maintaining an apartment close to the City in the villages of South Melbourne, Collingwood Elwood & Brighton whilst making the family home on the Peninsula, West coast or Macedon Ranges. That’s why we have seen those markets rise to extraordinary levels also. So I sense that the urbanisation may have stalled and a line has been drawn. Buyers want the City for dining, study, work, sports and enterntainment and the regions to enjoy time with family and space to unwind. Covid has taught us that none of us are getting out of life alive so we have to enjoy it.
The next decade I think the trend will only get stronger. I think we will see our regional communities grow and our loved holiday getaway spots become family home towns for traditional City dwellers. WFH is now a thing rather than a stopgap and the ease of commuting with the onset of autonomous driving and better rail and transport infrastructure will ensure that to commute is not only palatable but enjoyable. The City will be a thriving hub of work, education, entertainment and sports.
JC: How important do you view the push for sustainability practices in the apartment market, and what initiative has seized your interest or focus?
MP: I love what GURNER, Hip V Hype and Millieu in particular are doing with their focus on sustainability and industry leading strategies in the new developments market. We are now seeing individual activism in the sustainability space where I think we have worked out that marching in the streets and holding up traffic is really doing nothing in changing politicians minds to act on climate change. We are seeing market led change as buyers are consuming what leaders of the industry are now implementing.
I think we all want to be environmentally conscious and our developers are showing us how to do it! History will show that it wasn’t government virtue signalling, but the entrepreneurs and developers who effected the most amount of change.
Every (and I mean EVERY) buyer I speak with is asking what star rating is the building and is there EV charging? Most buyers don’t have an EV but understand that they soon will have. This is again a situation where our visionary developers are building what we don’t even know we need yet. It's market led. It's happening now.