Real estate, post level 4

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#2701457 3-May-2021 21:54

quickymart:

Can someone please explain this for me?

https://homes.co.nz/address/auckland/beach-haven/2-288-rangatira-road/MgMK

What could possibly cause the price for this property to drop so much, so recently? Does demolishing the house and leaving vacant land cause this kind of drop?

No one will be able to tell you without more information. There could be any number of reasons including the one you have postulated. Give the agent a ring and ask them.

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Handle9

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#2701478 4-May-2021 03:26

Batman:
tdgeek:

I also don't buy into the low housing stocks issue.

i wonder why the govt is forking out 3.8 billion to increase housing stock if there is no housing stock issue

https://www.tvnz.co.nz/one-news/new-zealand/government-puts-3-8-billion-into-speeding-up-pace-and-scale-house-building

https://thediplomat.com/2021/03/can-new-zealand-fix-its-housing-crisis/

Because there is a serious shortage of houses. It's fairly silly to say there isn't when there is ample evidence of housing shortages. People don't live in cars, governments don't put people in motels and house prices don't increase when there is enough supply.

tdgeek

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#2701491 4-May-2021 07:21

Handle9:

Because there is a serious shortage of houses. It's fairly silly to say there isn't when there is ample evidence of housing shortages. People don't live in cars, governments don't put people in motels and house prices don't increase when there is enough supply.

Thats more of a social housing problem. Social housing was sold off in the past, now its being pushed again, the Govt is building/acquiring more social housing, albeit that was scuppered somewhat since Covid. Then there is today's modern NZ economy, low wage economy and high rents. The rest of us that own or rent, the supply issue right now is not many are selling. To satisfy a buyer you need a seller. No doubt more houses in the buyer/seller market would be good, that would add more equilibrium, but Kiwi's would rather buy than build. Annecdotally I've read that building permits in AKL are up, perhaps the market is moving that way

Edit: Kiwisaver too, thats a modern phenomenon that has allowed many that cannot save for a house to be able to. Im sure there are thousands upon thousands that are now in the buyer market that would normally be in the rental market

Handle9

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#2701697 4-May-2021 13:21

There is ample evidence that the availability of housing is dropping. Every stat confirms this. The NZ population rose by 2.1%pa between 2013 and 2018. The number of available houses rose by 1.3%. Over 5 years that is approximately a 4% shortage of houses.

In Auckland the population rose by 150000. To maintain the availability of housing in Auckland there would have needed to be ~55,500 houses built. There were 26,745. There we half the number of houses built to maintain supply at the previous level, which was already grossly unaffordable.

NZ home ownership is now at it's lowest level since 1951. It's even worse for young people. In 1991 61% of people 25-29 years owned a house. Now it's 44%.

Every single available statistic shows that housing supply has not kept up with demand.

tdgeek

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#2701705 4-May-2021 13:49

Handle9:

There is ample evidence that the availability of housing is dropping. Every stat confirms this. The NZ population rose by 2.1%pa between 2013 and 2018. The number of available houses rose by 1.3%. Over 5 years that is approximately a 4% shortage of houses.

In Auckland the population rose by 150000. To maintain the availability of housing in Auckland there would have needed to be ~55,500 houses built. There were 26,745. There we half the number of houses built to maintain supply at the previous level, which was already grossly unaffordable.

NZ home ownership is now at it's lowest level since 1951. It's even worse for young people. In 1991 61% of people 25-29 years owned a house. Now it's 44%.

Every single available statistic shows that housing supply has not kept up with demand.

Be interesting to see the trends since 1951. What happened prior to 1951? Government building project post Great Depression and again post WW2. Since then home ownership has been declining in linear fashion? I assume so. If so, then this isn't a new problem. Why is it a big issue now? Is it causing more price inflation than 2.29% interest rates? Or so many Kiwisavers cashing up, that didnt exist before? Or investor heaven? Or 110,000 returning Kiwis? I'm not so sure. Sure, physical stocks are a factor, but as Kiwis prefer to buy than build its likely to have been a long standing issue, not a recent issue. The blame is I guess on the people, its they that can choose to build and not buy, but we buy, much easier.

Edit: I didn't say there isn't a physical stocks issue, just that I don't buy it (as a major cause of recent house price inflation)

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#2701740 4-May-2021 15:12

quickymart:

Can someone please explain this for me?

https://homes.co.nz/address/auckland/beach-haven/2-288-rangatira-road/MgMK

What could possibly cause the price for this property to drop so much, so recently? Does demolishing the house and leaving vacant land cause this kind of drop?

If you look at the listing (currently still up here - https://harcourts.co.nz/Property/916515/MJ44968/2-288-Rangatira-Road ) it contains phrases like ...

"If you're a builder or a re-cladder then you're the right person to fix me" and "There is a good opportunity here to do a makeover and reap the rewards as the other owners have down this driveway" and "Disregard my Current Rating Valuation of $740,000 - bring me offers!".

Looks suspiciously like it has/is/will be a leaker, and hence someone wanted rid of it.

alasta

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#2701741 4-May-2021 15:13

It's also worth noting that the average household size is decreasing because fewer people are marrying, fewer couples are having children, and families are having fewer children.

So, the number of properties would need to increase at a greater rate than the population just to keep up.

quickymart

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#2701795 4-May-2021 16:40

antant:

If you look at the listing (currently still up here - https://harcourts.co.nz/Property/916515/MJ44968/2-288-Rangatira-Road ) it contains phrases like ...

"If you're a builder or a re-cladder then you're the right person to fix me" and "There is a good opportunity here to do a makeover and reap the rewards as the other owners have down this driveway" and "Disregard my Current Rating Valuation of $740,000 - bring me offers!".

Looks suspiciously like it has/is/will be a leaker, and hence someone wanted rid of it.

Still a pretty good price, I would have bought it and then just got a builder to sort it out. Wouldn't cost the earth and the interiors are quite nice (IMO).

Handle9

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#2701797 4-May-2021 16:43

quickymart:

antant:

If you look at the listing (currently still up here - https://harcourts.co.nz/Property/916515/MJ44968/2-288-Rangatira-Road ) it contains phrases like ...

"If you're a builder or a re-cladder then you're the right person to fix me" and "There is a good opportunity here to do a makeover and reap the rewards as the other owners have down this driveway" and "Disregard my Current Rating Valuation of $740,000 - bring me offers!".

Looks suspiciously like it has/is/will be a leaker, and hence someone wanted rid of it.

Still a pretty good price, I would have bought it and then just got a builder to sort it out. Wouldn't cost the earth and the interiors are quite nice (IMO).

You wouldn't get finance. It's probably a 100k+ reclad and you can just hope that it's not too rotten.

Beccara

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#2701799 4-May-2021 16:45

Yup! No finance or 50% deposit. Banks HATE leaky homes and it may have already been on a blacklist

Most problems are the result of previous solutions...

All comment's I make are my own personal opinion and do not in any way, shape or form reflect the views of current or former employers unless specifically stated

alasta

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#2701800 4-May-2021 16:50

If it has rotten timber framing like a lot of monolithic clad leaky homes then "getting a builder to sort it out" would involve demolishing it and starting again.

You seriously need to know what you're doing if you're going to buy a suspected leaky building.

wellygary

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#2701802 4-May-2021 16:53

quickymart:

antant:

If you look at the listing (currently still up here - https://harcourts.co.nz/Property/916515/MJ44968/2-288-Rangatira-Road ) it contains phrases like ...

"If you're a builder or a re-cladder then you're the right person to fix me" and "There is a good opportunity here to do a makeover and reap the rewards as the other owners have down this driveway" and "Disregard my Current Rating Valuation of $740,000 - bring me offers!".

Looks suspiciously like it has/is/will be a leaker, and hence someone wanted rid of it.

Still a pretty good price, I would have bought it and then just got a builder to sort it out. Wouldn't cost the earth and the interiors are quite nice (IMO).

Land Value was 315K, SO they are not expecting much of the structure to be salvageable... I'm guessing its likely to tick all the boxes,

Monolithic cladding problems, no eaves/gutter water ingress, Laser Frame/untreated timber rot potential, potential surface water ingress...

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#2701812 4-May-2021 17:09

alasta:

If it has rotten timber framing like a lot of monolithic clad leaky homes then "getting a builder to sort it out" would involve demolishing it and starting again.

You seriously need to know what you're doing if you're going to buy a suspected leaky building.

Given the age of it then it's probably a cross lease. Knock down becomes much harder at that point.

mattwnz

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#2701827 4-May-2021 17:36

What annoys me at the moment is there is quite a bit of land coming on the market, but some agents are marketing as a good land banking opportunity. This means some will just buy and sit on it for capital gains. There are literally people chopping their back garden off their house and trying to get up to 400-500k for a small section, and hoping that won't affect their existing house value too much.. We need a land tax or vacant house/land tax to prevent this sort of carry on, as it is a housing crisis, so we can get more houses built, as lack of available land is one of the leading problems.
The land is also very expensive. In some cases double the price that it was pre covid. Lots of people therefore reselling sections they purchased less than a year ago, and can easily get 100k 150k + capital gain after agents fees. Guessing many also have to pay tax on the capital gains too, which also probably increases the price. Each time someone sells so soon after buying also instantly increases the price of that and other nearby sections, because they have to get more including agents fees, than they purchased it for.Then when one section sells for a crazy high price, agents then use that as a new bench market to sell other land for. I am trying to buy a section myself and this is what I have found, and even an agent I use says it is crazy, especially in areas where there is very little land for sale anyway, although surrounded by farmland.

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#2701874 4-May-2021 17:39

Interesting article from Oz, the bank of mum and dad which is having simialr problems, and 60 percent of first home buyers using the mum and dad bank to borrow to buy a house. Mum and Dad bank is now the 9th biggest lender in Oz! NZ has similar problems, but Oz don't have the same speculation with investors that NZ has had, so haven't had to introduce the same new laws around interest expenses and tax.

https://www.abc.net.au/news/2021-05-03/the-bank-of-mum-and-dad-house-prices-property-first-home-buyer/100102132

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