Auckland's "ugliest house" is still waiting for a fairytale ending.
The property at 62B Stranolar Drive, in Mt Roskill, which the selling agent had billed as a disaster, passed in at auction today after just one bid of $500,000.
However, a deal still may be done, with the auctioneer telling bidders in the room that the number wasn't far off what the vendor was seeking and the selling agent revealing earlier today that he had several conditional offers on the table.
It made the headlines soon after it was listed last month, largely due to the Fred Flintstone-style two storeyed round concrete-plastered dwelling that sat beside the main house.
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The owner and agent flagged that the secondary house had major leak issues and no Code of Compliance Certificate for the main four bedroom house.
With a zoning of mixed housing suburban and a Council-assessed land value of $790,000 on the half share of 840 sq m of land, the elevated property could have had development appeal as it is on a popular street near parks, motorways and the area’s two golf courses. But it is on a cross lease, not a unit title, which limits the potential of the site for adding more than one unit, Barfoot and Thompson real estate agent Alex Yang says.
Yang billed the property, as a “disaster”, but media attention on the property attracted over 19,000 viewings of on-line listings. After all the media interest, the auction was postponed for a week, but even so, Yang says, only 15 groups made it through open houses during the marketing campaign.
He said that most people had trouble sorting out finance, as to buy a property with no code of compliance and serious building issues was generally a no go with banks.
Lenders are now reluctant to finance buildings with non-compliance issues, says Squirrel Mortgage’s John Bolton
"In the best case scenario, banks would only lend on this sort of property up to 70, probably not even 80 percent of land value. Or maybe only 50 percent for a builder," he says.
"And they'd be looking pretty hard at have you got the competency to deal with this - that means the only buyers would be experienced builders or developers. You'd have to have at least $300,000 to $400,000 of your own cash kicking around, it's quite hard to develop a cross lease site so that's limiting the appeal."
"And buying a project like this is different to buying an empty section, banks would need to know you've got a plan for what to do with it. You'd never take a deal like this to a bank, they haven't the experience to fund a complicated transaction like this, you'd need a broker to figure this all out for you."
Yang said earlier today that he has buyers are lined up to make conditional offers if the property doesn't sell under the hammer.
