07 Jul 2013

Neighbours joining gold rush

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Written by: Russell Blackstock
Photo: Doug Sharring
Published: The New Zealand Herald – 07 July 2013

Sale prices escalate when two properties seem better than one.

Fiatamalii Fioli wasn't swayed when a neighbour made a megabucks offer for her house.

Fiatamalii Fioli wasn’t swayed when a neighbour made a megabucks offer for her house.

Neighbours are throwing their lots in together to sell combined properties for greater sums on the lava-hot property market.

Subdividable properties are being snapped up, getting homeowners talking across fences to boost their fortunes on larger land lots with greater potential for development.

“This is something I have been hearing more and more of because the property market is so heated,” Andrew North, auctioneer at Harcourts Cooper in Takapuna, said.

“A client with an 800sq m site in Kitchener Rd in Milford approached me with the idea of selling to a developer at the same time as their neighbours. They believed they could be sitting on a goldmine if the properties were combined and further subdivided.”

A North Shore 1950s four-bedroom property in Exmouth Rd, Northcote, sold to a developer for $996,000 this year – a staggering 103 per cent above its CV rating. Some developers are landbanking properties in Northcote and Takapuna. If a controversial Auckland Council Unitary Plan to intensify housing within the city boundaries is approved, even more mid-rise or low- rise apartments will be permitted on land that at present has only one house sitting on a large plot.

In January, a modest house on the Albany Highway went for $755,000, 109 per cent above its CV of $360,000.

Les Barnes, of Barfoot & Thompson in Coatesville, said the the owner had bought the house next door and flicked both houses to a developer as one lot, because another two homes could be built on the same site.

Barnes said the second house sold for $600,000, despite being bought months earlier for $470,000. “The combined price was $1.35 million. Separately, the properties would have raised not much over $1m, so it was a tidy profit for the vendor.”

Ivan Wagner, from Harcourts in Albany, is negotiating a combined sale of two properties for neighbours in sought-after Rothesay Bay.

“People are asking me more and more if this is a good way to realise the best prices for their properties,” Wagner said.

A standalone house in upmarket Mt Eden with a CV of $1.7m is expected to fetch $4.5 to $5 million because it is on a 2868sq m plot.

Selling agent Martyn Hamilton, of Orange Realty, said the site was last on the market 40 years ago and could hold seven dwellings.

“It is not unusual for houses in Mt Eden to sell for $2 million, so it is not difficult to see why the property is proving so attractive.”

Chris Darby, chairman of the Devonport-Takapuna local board, said there was no guarantee the draft Unitary Plan would be approved and people banking on being allowed to build apartments or more houses in their back yards were taking a risk.

“There is a danger that if the rule changes don’t go through, the next step is purchasers might have to deal with insolvency experts. They might have better luck taking their money to SkyCity and gambling.”

Family’s home is where the heart is

Fiatamalii Fioli shares a neat, wooden bungalow on Exmouth Rd in Northcote with her niece, Nia Apu. It has a CV rating of $470,000. It also sits on 1100sq m of land.

Three months ago, Fioli, 61, says her new neighbour knocked on the door, offered her $600,000 cash and promised to buy her a replacement house in the area.

“She brought a bag of muffins, sat at my kitchen table and came right out with it,” Fioli says.

“The idea was she would join together her land and mine, so the plot would then be big enough to build another house at the back that they could sell on.”

Fioli’s enterprising neighbour recently bought the property next door for $996,000 – 103 per cent above its $490,000 CV rating.

“I told her ‘no way’ because I have lived here for 48 years and this is my family home.”

And, Fioli says: “Money isn’t everything.”

– Herald on Sunday



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