A multi-million-dollar lifestyle block on the outskirts of Hamilton has hit the market as a mortgagee sale, amid concerns that forced sales are on the rise.
The seven-bedroom home and income property at 239 Houchens Road, in Glenview, sits on a near 6-hectare block and has a 2022 RV of $2.23 million.
Listing agent David Forster, of Harcourts, said in his listing on OneRoof that “properties like this” seldom “come to the market under these circumstances”, noting that buyers should “undertake their own due diligence”.
The mortgagee sale is Waikato’s third this year and is notable for its price point. Most forced residential sales in the region tend to involve homes at the lower end of the market.
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OneRoof records show the Houchens Road property was bought in 2015 for $250,000 and that a home was built on the land in January 2016, with further consents issued for the property eight months later.
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Forster declined to comment on the Houchens Road sale but said it was relatively unusual for higher-end lifestyle properties to be sold by mortgagee sale. The last time he sold a lifestyle property as a mortgagee sale was “at least several years ago”.
Homeowners at the upper end often sold before their lender stepped in, he said. “They are more proactive about saying, ‘We are in trouble. If we don’t sell, the bank will’.”
In the last financial year, Forster had only one mortgagee sale and a handful of insolvencies due to bankruptcy or business failures.
“I think it’s fair to say there hasn’t been the level that I had expected, which is great for the community. I thought there would be more.”
The Houchens Road home was built in 2016 and includes two living areas, a modern kitchen and a scullery. Photo / Supplied
The separate two-bedroom dwelling might attract extended families or people wanting a home and income property. Photo / Supplied
Jeremy O’Rourke, managing director of Lodge Real Estate, told OneRoof that mortgagee sales would rise in coming months – not just in Hamilton, but across the country.
One of his agents, Paul Conway, is selling a three-bedroom home at 12 Farnham Close, in Rototuna North, Hamilton, at a mortgagee auction next month, and O’Rourke was aware of several other mortgagee listings set to hit the market.
“There’s been a rise in those notifications so therefore we can expect that we are going to see a few more of them unfortunately,” he said.
“It’s really sad when you start to see a rise in them. It’s just the nature of interest rates moving from 3% to 7% and people who have fallen on harder times are unable to afford them.”
Valocity senior research analyst Wayne Shum said the current number of mortgagee sales in New Zealand was still below the pre-Covid average and well short of the volumes seen immediately after the GFC.
A brick and tile home on Farnham Close, in Rototuna, Hamilton, is also being sold at mortgagee auction next month. Photo / Supplied
“Generally, lenders prefer to work with the borrowers rather than force a mortgagee sale. However, mortgage rate pain is not over yet, with major rate cuts unlikely to be on the card in 2024. Some struggling borrowers may be forced into mortgagee situations.”
Just last week, a high-end home on Radar Road overlooking Hot Water Beach in the Coromandel, which had an RV of $4.48m, was withdrawn from the market the day before it was due to be sold at a mortgagee auction because the owner was able to remortgage. The auction had already been postponed by one week before it was completely scrapped.
Shum said there were risks associated with buying a property being sold in a mortgagee sale: Purchasers could not always go inside, banks might be more reluctant to lend on it and there was no guarantee what condition the property would be left in.
“You don’t know what you get when you settle – is the dishwasher and kitchen bench and everything still there? Is it trashed – who knows?”
- 239 Houchens Road, in Glenview, goes to auction on July 4
