Another derelict house, too upmarket for me to afford

North wall, derelict house, Annet, Sheffield, 1 Sept 2020

Just after midnight 31 Aug / 1 Sept, before shutting down the computer for the night, I saw this place advertised, as for sale by Mortgagee Auction on 2 September. I decided to go and view it on the Tuesday the 1 September 2020 (on the video, I said ‘Monday’ by mistake).. The condition was rather worse than the photos on the advertisement showed. It looks like some home made double-doors had been removed since the photos were taken, leaving a large chunk of wall entirely open.

East wall, derelict house, 14 Fraser Street, Annet, Sheffield, NZ

The house had apparently been undergoing some much needed repairs and renovation, however some aspects, like seeing the Fuseboard having been removed from inside the house and discarded in the backyard, including with the Electric Meter still attached, certainly makes one wonder if the house was deliberately vandalised prior to the Mortgagee Auction taking place. Electricity meters belong to the relevant authority and are only allowed to be connected, and disconnected by certain authorised persons.

Fuseboard, meter attached, dumped in garden

However if the mortgagee auction is even allowed to run at all, I expect it to be as corrupt and evil as most Australia and New Zealand auctions. I intend to attend but expect it will go for w-a-y more than I can possibly afford. Note that according to the government valuer, the house (excluding land) itself is currently valued at $140,000. The land itself being valued at $90,000

UPDATED on 2 September 2020. I attended the auction which had close to 30 people present and at least two real estate agents acting for clients on the telephone. Starting at 11am the auctioneer spent about 5 minutes stating conditions clearly and then the bidding went for about 7 minutes. I was pleasantly surprised that the auction seemed to be run in a fair and legal manner.

To quote the auctioneer as he described the property “some may suggest, in need of enhancement”.  (Yeah, like if you want a whole wall to keep the snow out, maybe !) He could be a poet, that guy.

Bidding opened at $50,000 and went rapidly up past $115,000 at which point it was stated that the bank holding the outstanding mortgage was happy , and the place was therefore “on the market”. Bidding continued upwards until the final price reached of $137,000 After that the sheeple present clapped a round of applause. Yes, a stupid custom, often promoted by the charlatans in the real estate industry. (I’m looking forward to that custom being extended to include every time someone goes through a supermarket checkout or other in-store purchases at McDonald’s and Petrol Stations).

Doing some research it seems the place sold for $50,000 back in 2003, and then later in 2012 sold for $157,000 to the current owner. So “apparently” the place more than tripled in value in 9 years despite becoming an older and more worn-out building over those 9 years.  I wonder how many workers saw their wages triple, over that 9 year period ?

SouthWest view, 14 Fraser St, Annet, derelict house

That the bank allowed the auction to proceed to sale from $115,000 suggests that that was how much was still owing on the mortgage (plus other expenses and selling costs the bank would be entitled to reclaim). I believe it takes one full year (and possibly two) for a mortgagee auction to be enabled after a default in repayments, so the owner perhaps only paid for about six years. With a $157,000 purchase price and a $115,000 mortgage still owing as of today, apparently.

I do not know who bought it, some dude at the back of the room I believe. I do not know just what he plans for it. Perhaps he wants it to live in ? Note that New Zealand has no capital gains tax for most things, so often folks will just do a cheap and nasty fixup, throw a coat of paint over the top, and then walk away with $100,000 tax free profit in their back pocket. The current Labour/Greens coalition government has disavowed ever having a Capital Gains Tax as they don’t want to alienate the 62% of people who currently live in a house they own or partly own.

It seems that the 38% of people currently renting can just get knotted, and look forward to spending three quarters of their income on rents for the rest of their lives as landless peasants… apparently !

It was recently reported on Radio NZ that house prices, NZ-wide, had increased by an average of 16% over the last year and are expected to rise by  a further 17% over the coming year.  (Usually,  houses ‘only’ go up by 8% to 10% per year.  Cheaper houses almost always increase in price far more, when compared to more expensive homes.)

As even this derelict house, is far too expensive for me to afford to live in, I wonder… what CAN I afford ?

Here is a link to the first of 3 short video clips I recorded.

The curious case of the story, about the curious case of the Takaka Hill house that burnt down

(file photo, not this actual house)

In the early hours of Saturday morning, on 3rd August 2019, a derelict old farm-house burnt to the ground. It was a scummy old house in some part of the rural countryside in between Nelson and Golden Bay. It wasn’t heritage listed or anything, but it had stood visible from the main road for well over 100 years and was a well known landmark in the area.

It had sat empty for the last several years, becoming more and more derelict as over time, weather bore down on it  (and vandals, one assumes) smashed the windows and its condition deteriorated still further. Now old houses may catch fire for any number of reasons. If they’ve been abandoned awhile then it’s likely that mains electricity has already been disconnected so “electrical fault” is unlikely.  But with no-one at home to raise the alarm promptly, a fire is more likely to be well advanced before anyone notifies the Firies.  However even if it is not intentional vandalism, homeless folks might be sheltering within, and could have used an old fireplace with a chimney that needed repair. Lightning strikes during a storm are also possible.

On Saturday afternoon, the Stuff website (part of the Christchurch Press and Wellington Dominion newspapers) put up an article by Tim O’Connell online. It included pictures showing the house reduced to nothing but ashes and the remains of some partially collapsed brick chimneys.

Along with the article and those still photos, was a short video clip comprised of a slideshow of still photos, ending with one detailing how the place had been for sale for $375,000 .

I saw the story on about the 7th of August just before going to bed and noticed that it was one of the few stories that Stuff had allowed comments to be placed on. I also noticed that there had been only two comments by then. The following day I cranked up the ol’ computer again and made my comment. After a time (ALL comments are moderated and approved before publishing on the Stuff website) my comment was added there for all to see, and the total number of comments was then three. Woo-hoo !

I was checking back on that story later on Friday the 9th of August to see what other new  comments might have been added, when I noticed the article had been substantially re-worked. The video clip had been removed as had the entire comments section.

However the article now does refer to the house as having been for sale at the price I mentioned, at the time it was destroyed by fire.

I wondered if the article had had to be re-edited, perhaps the appearance, even for just a split second at the end of that video slideshow, of a sign listing the place for sale, breached some rule on advertising ?

Anyway on doing a little more research today, I notice that there was an article done on this house by Nina Hindmarsh back on 24th January 2018, and it has the video-slideshow located there. The video was apparently made or licenced to Stuff anyway (likely made  by Nina or another one of their team members in-house as part of that original story).

Anyway I think my comments are still very relevant and here they are from my saved copy of them. (Links to the 24 January 2018 and 3 Aug 2019 articles appear at the bottom).

(My comment as originally approved and uploaded). It is unfortunate that this old house has burned to destruction.  However I notice that in the last moments of the video,  a sign displays, it had been for sale for almost $400,000 (including the 8ha/20 acres of land).

It seems as if this building had been abandoned and left to go to rack and ruin for quite some time. Perhaps if the seller had been prepared to accept a lower price, someone could have purchase it, moved into it, giving them a home while they conducted repairs as necessary.

NZ is gripped by a Housing Crisis, of both Unaffordability and Unavailability. When old houses are allowed to become derelict and later destroyed by wind storm or fire, it is a double whammy.

That’s another house NO longer available to be purchased cheaply to live in, and thereby another would-be homeowner still renting, putting pressure on the rental stock. (End of the original comment)

Here follow links to the 3 August 2019 and 24 January 2018 stories. Do be aware that stories (including photos, captions and videos)  can be edited and modified or completely removed at any time… that’s clearly the prerogative of the Stuff’s website owners and operators.

https://www.stuff.co.nz/nelson-mail/news/114728352/fire-sweeps-through-abandoned-takaka-hill-homestead

https://www.stuff.co.nz/life-style/homed/100800414/lonely-takaka-hill-house-hides-lively-history?rm=a

Here from a  later Stuff story on the rampant inflation of house prices. The following story talks about it as if it’s a good thing. Really there are many benefits when the price of used housing for sale goes down and down.  Just like as the price of used cars becomes lower and lower as they age, it gives opportunities for poorer people to buy cheaper cars that are already in less than new condition for less than new prices.

 

https://www.stuff.co.nz/business/property/117317608/how-a-town-changes-when-house-prices-double-in-five-years

Kiwibuild failures cost Phil Twyford his cabinet position

(File photo, details at bottom)

It’s hard not to feel sorry for our poor old housing minister as Phil Twyford was  unceremoniously Kicked to the (parliamentary) Kerb, so to speak. He’d taken over the idea of “Kiwibuild” and run with it though he did, the policy seems to have been an arthritic  three-legged  donkey right from the start.

Two years in, and with an initial target of “1,000 houses” to have been built by now, just 141 have been delivered (and many of those simply bought off-the-plan from existing property developments) and with many un-sold because their price is just too high anyway. (Some figures say the number delivered is actually 202).

A recent article by Duncan Garner on the Stuff website has gone into detail how Phil Twyford was effectively “thrown under a bus” for much greater failings in Labour’s policy, and execution of that policy.

Mr Garner says: “… I’ve been approached to help a young pregnant woman move from a car to permanent housing. And that’s the issue: KiwiBuild was designed to see off middle-class angst over the huge cost of entering the housing market, when what’s really needed is social housing, emergency housing and affordable housing. …”

I have been arguing for YEARS (indeed, more than a decade) that there hasn’t been enough done, indeed ANYTHING done, for the BOTTOM end of the house price spectrum, either for people needing to rent the cheapest homes or people looking to buy the cheapest homes.

In another article on Stuff, Henry Cooke has gone on to describe how policy changes are still needed to help out the middle class.

Mr Cooke says: “… Despite serious strides in the number of state houses built, and good results from the rule changes discouraging speculation, the disastrous performance of KiwiBuild has made the issue a vulnerability. …”

Although I largely concur with Mr Garner’s and Mr Cooke’s recent analysis of the housing situation, my opinion is still that the “middle class” area of housing could be largely left to it’s own devices and market forces, *IF* there was a substantial injection of new housing provided at the bottom end of the market (both for rent and to buy).

This is because, like used to happen in bygone days, many people would start off with a tiny two bedroom house, and then later, as funds permitted, add on an extension (or have a separate “sleep-out” built adjoining the main house).

Those houses, by then enlarged and with some upgrades installed, creep up off the bottom of the barrel and become the next tier of “middle priced” homes which those in Mr Cooke’s middle class, can aspire to buy (or rent).

If the government would just activate the various levers as necessary and fix the bottom part of the housing market (regards both rentals and purchase), I’m sure the rest of the market would settle down and pretty much fix itself.

Here are links to the recent articles by Mr Gardner and Mr Cooke.They are worth reading for the extra detail they contain.  Also of note is an article on the Stuff website from 30 June 2019,  headed by Bonnie Flaws (“Kiwibuild is broken – so how can we fix it?”), where she gets opinions from nine of the “movers and shakers” working at the coal-face of our current housing dilemma.

https://www.stuff.co.nz/national/politics/opinion/113869026/twyford-thrown-under-bus-for-labours-epic-slogan-fail

https://www.stuff.co.nz/national/politics/113853434/labour-still-needs-a-middleclass-housing-policy

https://www.stuff.co.nz/business/113811161/kiwibuild-is-broken–so-how-can-we-fix-it

 

 

 

File Photo details… This old cheaper house, (driveway could fit four parked cars) priced at $320,000 at 216 Worcester Street in Christchurch, has been demolished, to be replaced by four units, priced at $456,000 each. But with no parking on site at all, and on a stretch of road that already has grossly insufficient parking available.

 

Kiwibuild an abject failure, Government refuses to do diddly-squat

The photos are an example of an old house near me. Note this isn’t in a cheaper suburb like Aranui, this is prime real estate inside the Christchurch City CBD. It had already been repaired (since 2011), but it was (apparently) an “earthquake write-off” as the small land area of about 400m2 was valued at $295,000 and the 3 bedroom house, although repaired and fully liveable, was valued at just $25,000. (One assumes it had “foundation damage” that would have costed about $100,000 for a “full fix”, after which the house would have been re-insurable for a higher amount).

Enough yard remained at the side and rear to give off-road parking for up to four cars. It has since been demolished. In it’s place will be constructed four, two-storey townhouse units, with zero facility for parking, indeed there isn’t even anywhere off-street for delivery trucks etc to stop.

62% of New Zealand voters already live in a house or home unit that they own or are paying off and therefore partly-own. They WANT the price of housing to keep increasing. 38% of the population are little more than maggots, land-beggars. They have no say in the matter and are by far the smaller percentage when it comes to voting at Election Polls.

I would argue that even the way KIWIBUILD was set up to work is fundamentally wrong. The whole idea of building a few extra houses, to sell into the MIDDLE RANGE of the existing “free market”, and whereupon those houses then simply increase in price all the time anyway, just doesn’t make sense to me.

The problem is NOT primarily not enough houses for sale at the mid-price range of the market. The biggest problem is not enough homes available for sale at the very BOTTOM of the price range. And even the price of them keeps on going up and up. Remember that the cheapest houses increase in price at the fastest rate.

To take the Christchurch example. Kiwibuild homes are priced at $450,000 to $550,000. This gets you a small townhouse unit on a tiny section of land. But if a buyer, single or couple, had enough deposit and high enough wages so as to be able to meet the repayments on a loan that large, they could already simply have walked in and bought one of the existing older houses in the cheaper suburbs like Aranui and Wainoni, where an old 3 bedroom stand alone house on a full size section of land can be bought for about $300,000.   Buyers in the price range of $450,000 to $550,000,  could already simply have the pick of any number of beautiful homes in nicer suburbs throughout Greater Christchurch, mostly on larger established land sections (usually between 650m2 and 1012m2, the old, “full quarter acre”).

The population who AREN’T being catered for, are single people and childless couples working for the lower wages (which is what MOST people earn… in Australian studies, something like 74% of people earn LESS THAN *AVERAGE* wage). It’s likely about the same percentage in New Zealand.

At the standard bank financing formula, folks earning the minimum wage can go shopping for houses in  prices around  $150,000 maximum. Clearly there is nothing at all available, in the entire greater Christchurch area.

House prices, at least in the bottom part of the market, need to fall by half at least, to increase housing affordability to those folks on lower wages who don’t have a line of interest-free credit from the, so called, “Bank of Mum and Dad”.

It is now commonplace in NZ especially Auckland, that even DINKs (double income no kids) couples who are both on good wages, can only get into their first home purchase by having money gifted to them by their parents. (In Auckland a small Kiwibuild home unit in a premium area is $650,000 although full sized older houses on full sized land sections are available for $490,000 in cheaper areas anyway).

This further entrenches in society, the rapidly growing schism between the wealthy, land owning elites one one side and intergenerational poverty and poor housing outcomes for the remainder.

That remainder, it should be remembered, is almost 40% of the population of our society.
The article from Christchurch’s The Press newspaper’s, Stuff website, appears below. At the bottom is a link to a short video I recorded about the (now demolished) house depicted in the still photos.

https://www.stuff.co.nz/business/110595201/kiwibuild-the-solution-you-come-up-with-when-you-dont-want-to-fix-the-problem

Christchurch… not enough houses, but a glut of office-space (albeit without any parking)

An article on the Christchurch Press newspaper/Stuff website, by Marta Steeman on 24 January 2015 said this…

“…Anyone who’s driven along Durham Street North, which flows into Cambridge Terrace, recently can’t help but be struck by the boom in commercial construction along the strip on the western edge of the Avon River.

The buildings jostling for space and attention sit just outside the CBD, a much smaller area than it used to be after being redefined by the Government’s blueprint for the rebuild of the city. And that’s important because the area is free of the Government prescriptions imposed on the blueprint development, developers say…” (Quote ends)

(A link to the full article appears at the bottom of this article, but here is just one of the comments that was posted below it)

ChrisW1970 7 days ago (as of 31/01/15)

I for one am glad that the private sector have been able to get some traction on rebuild projects. If you look at government and CCDU precincts, progress is minimal, compared to across the river west of Durham St. By exerting such a high level of control, CCDU and government/local authority have only served to add unnecessary delays and costs to anchor projects – frankly I think the best thing to do now would be to disband the bureaucratic stinking colostomy bag that is the government run CCDU, and open up ALL the anchor projects to private tender – that way you might actually see some anchor projects completed this decade, and for less money than will be if CCDU and government are allowed to continue to operate in the bumbling and useless manner they have been… of course the CCDU website claims things are going swimmingly on their projects…nonsense! The lack of visible construction works tells a different and more truthful story… (Quote ends)

When I first heard about the much vaunted CCDU Blueprint, in mid 2012, I immediately had major misgivings.

As I saw it, it was a government land-grab, for upto 60% of the CBD area, and as the land was to be seized under special CERA laws, property owners had even less rights than if it was taken under longstanding PUBLIC WORKS act rules.

I thought “Yeah mate, Wellington’s just gonna steal the land, then sell parcels of it off, probably back to its mates, at whatever price it chooses.”

And it seems as if I was 100% correct, going by the following article by Georgina Stylianou from the Stuff website on 31/01/15.

“… The Press understands Fletcher Building, which will wind up its work with the Earthquake Commission this year, is the front-runner among the shortlisted firms being considered by the Government to develop the east frame…

…Last year, CCDU planning general manager Don Miskell said residential land was cheaper than commercial land so the Crown may not recoup the money it had spent buying land in the east frame… (quote ends)

Commenting on the other article, about the Government’s mate, Fletchers, being the front-runner for getting handed over a bunch of, previously other people’s properties, for less than, even the bargain basement price that CCDU gave as “compensation” for stealing people’s freehold land off them.

The prices the government pays for land are secret, however some landowners have said that “negotiations” started with them being offered 10% of the land’s original RV (Ratings Valuation) and eventually the government would creep upto a figure of about 90% of RV. (If you don’t accept the 90% offer, then under the CERA/CCDU blueprint law, the government simply takes your land and gives you nothing).

The problem comes when the old owner seeks to buy new land, similarly zoned, close in to the city, and finds they have only a half to a third of the price of replacement land (it’s not rocket science… remove 60% of the supply of any product and the price will go through the roof, doubling or tripling, what would you expect !).

Some owners or organisations have been right royally screwed over by the government land seizures. The Deaf Society should have been laughing all the way to the bank, as insurance paid for a full rebuild, no expense spared, of the CBD headquarters, but with the government seizing their land, they are only entitled to a far lesser “indemnity value” payout. So these people have effectively been dis-enfranchised from, and lost the benefit of, having a “full replacement, regardless of cost” insurance property.

And don’t even get me started on the debacle over the historic MAJESTIC HOUSE building. This multi-storey building on Manchester Street was repairable for about $15 million (a full re-build would have cost an estimated $60 million), however the owners “Majestic Church” had to take whatever CCDU was prepared to offer in “compensation” for the land, and a lesser indemnity value insurance payout on the building. Since shortly after the February 2011 earthquake, they have been meeting in a refurbished car-sales showroom on Moorhouse Avenue, but the site has almost no parking and they are forced by council rules to pay for parking some distance away. Insurance has been covering some costs, but the church, wanting to settle into a permanent and more appropriate environment, purchased land elsewhere in the Western CBD (part of the 40% remaining that the government didn’t steal) and was intending to re-build its church there, however Christchurch City Council have denied it the necessary planning permission on the basis that “it’s a residential area” (and obviously churches cannot be in residential areas, can they ?).

Here below is the link to the article about the East Frame and Fletchers likely involvement.

http://www.stuff.co.nz/the-press/business/the-rebuild/65628376/Fletchers-front-runner-for-Christchurchs-east-frame

Here is a link to the full article on the STUFF website about the expected glut of high-priced office space …

http://www.stuff.co.nz/the-press/business/the-rebuild/65372186/Christchurch-faces-glut-of-office-space