- A Christchurch home sold for $1.37m, nearly $700,000 below its rateable value, due to earthquake damage.
- The “as is, where is” property attracted five bidders, selling after 15 bids to a local couple.
- The new owners are undecided on repairing or demolishing the four-bedroom mansion on Allister Avenue.
A Christchurch trophy home has sold under the hammer for just $1.37 million - almost $700,00 below its RV.
Start your property search
The four-bedroom mansion on Allister Avenue, in Merivale, looks like it should have sold for a top price, but earthquake damage from almost 15 years ago left it in an uninsured state.
New Zealand Sotheby’s International Realty agents Sean Lines and Nicky Armitage had pitched the vendor’s “as is, where is” home as a rebuild opportunity on one of the city’s most coveted and private streets, and it seemed to do the trick.
There were five registered bidders at last week’s auction, three of whom put their hands up in the room.
The auction opened at $1m and sold to a local couple after a total of 15 bids.
Allister Avenue presented well but was uninsured. Photo / Supplied
The four-bedroom property is on one of Christchurch’s most coveted streets. Photo / Supplied
Lines said the new owners were undecided about whether they would repair the home or flatten it and start again.
About 80 groups went through the property during the marketing campaign, and most were looking to live there. Developers had shown some interest in the 617sqm site, but most had been looking for something over 1000sqm.
In terms of repair costs, Lines said it was a case of “how long is a piece of string for some people”.
While the market for as is, where is properties in Christchurch has remained relatively strong since the earthquakes in 2010 and 2011, the pipeline had slowed.
Discover more:
- Bachelor NZ’s Art and Matilda selling the villa they bought mid-flight
- Tony Alexander: No zing till spring - why the housing market has stalled
- Tenants offered price drops, rebates and vouchers as landlords get desperate
Lines said as is, where is homes like the one on Allister Avenue were relatively rare in the market, with most having either been fixed or sold years earlier.
He told OneRoof that the vendor had been living at the address until recently, and had sold up for something smaller.
While the sale price was below the $1.45m land value, the vendor managed to get more than the $960,000 they had paid for the house in 1995.
Bayleys Fendalton agent Steve Ellis told OneRoof earlier this month that the peak period for as is, where is sales had been between 2017 and 2019.
He said the RVs on these homes were not always a good indicator of price, and in some cases, owners of uninsurable homes had pressed the council to reduce their RVs. “The land value might be worth $900,000. So, the RV should be $900,000, not $1.8 million, because the house no longer has any value,” he said.
The 2011 Canterbury quake destroyed many houses and left thousands more in an uninsured state. Photo / Getty Images
“Quite often, however, the council won’t even be aware of it unless it’s been brought to their attention.”
As is, where is homes weren’t for amateur renovators either, and those hoping to get a bargain would have to think carefully about the costs involved, he said.
“[The deal] might sound good, but there are traps. You’re not just going to walk in and grab a bargain, and it will be OK. What happens is some people think it might be a $200,000 repair, and then all of a sudden, they’re facing a $400,000 repair, and all the upside they thought they had is gone.
“That’s why most buyers are builders or very savvy developers who know these products back to front. Sometimes they buy for land value and plan to demolish the house and develop townhouses or a new property on the site.”
He added: “The majority of as is, where is properties have sunk on one or more sides. It might be completely structurally sound but out of level, so you can’t get insurance.”
Repairing the problem involved lifting and fixing the foundations and could cost anywhere from $30,000 to $300,000, he said. “There’s a huge range of cost depending on a lot of factors.”
“With large houses, the cost of re-levelling can be prohibitive. And you would end up with a product where the buyers would not necessarily have confidence in the property because of it.” In that case, it may be better to bowl the home, he said.
- Click here to find more properties for sale Christchurch
