A two-bedroom standalone home in the small Southland town of Nightcaps has been snapped up by North Island retirees for a bargain price.
Dubbed Sinclair Cottage, the architectural gem is one of the last original miner homes still left in the region and had been used as a museum before hitting the market in July.
It was sold “as is”, with a price tag of $105,000, due to the fact there were no services connected to the property, and the listing on OneRoof had advised buyers to do their due diligence.
Built in 1905, the cottage was managed by Southland Heritage Building and Preservation Trust, but a spokesperson for the body told the media recently it had decided to sell because the property now fell “outside the parameters of the trust”.
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Listing agent Eileen Brooker, of Professionals Invercargill, declined to reveal the exact sale price but told OneRoof the cottage was the cheapest she had sold in the last couple of years.
The vendors were very happy with the sale, she said. “I’m very excited for everyone. I’m delighted for the trust. It’s the end of an era for them.”
The property had been used as a museum and was sold "as is". Photo / Supplied
The house is one of the few remaining miner cottages in the region. Photo / Supplied
The buyers were moving from the North Island to Nightcaps, where they have family. “They are going to try to restore it as much as they can,” Brooker said.
Sinclair Cottage is one of the country’s cheapest house buys this year. OneRoof analysis of settled sales shows 26 properties have sold on the open market for less than $200,000. Ten of these were standalone houses, the cheapest being a run-down 1890s cottage in Oamaru, Waitaki, which sold in February for $67,000 – well below its RV of $185,000.
Buyers on the hunt for sub-$200,000 homes may be surprised by the range of properties on offer, although buyers should be aware that most of the properties for sale at the very bottom end of the market come with issues.
Those issues range from high ground rents to flood risks, and in many cases, buyers will need to pay cash, as banks and insurance companies typically refuse to touch compromised properties.
But the lower the price, the more enquiries agents tend to get. First-home buyers and dreamers are often behind enquiries fielded by agents. Some will succeed. Many of the cheapest homes in New Zealand are bought by builders and investors, who are often cashed up and not dependent on gaining a mortgage.
Property Brokers agent Paul Murray has sold a fair few bargain homes in his West Coast patch. One of his listings, 12 Con Street, in Seddonville, is a “munted” home with a $145,000 price tag. “Thanks to OneRoof and others I would estimate conservatively that I have had 200 enquiries,” he said of the home.
Buyers for such properties are often at the “lower end of the socio-economic scale” and are desperate to get on the property ladder.
New Zealand's cheapest house so far this year is a two-bedroom cottage in Oamaru, Waitaki, which sold for $67,000 in February. Photo / Supplied
A "munted" two-bedroom house for sale at 12 Con Street, in Seddonville, Buller. Photo / Supplied
On Con Street, Murray was working with a Californian “surfer dude” but the property had too many issues – the boundary runs right through the house – to get the sale over the line.
The cost of sorting out the title problem with an “amicable neighbour” could be around $70,000, but not everyone was up for the challenge, said Murray, who declared in his listing on OneRoof that the property “isn’t a mere ‘fixer-upper’ – this is a project for the bold, the brave, and the slightly unhinged”.
First-home buyer homes have often stretched beyond $1 million in Auckland, but the city is also a surprising source of sub-$200,000 properties. Scores of apartments in Auckland CBD can be found at the bottom end of the market. Most are small, are on leasehold land and have weathertight issues.
Colleague Rob Maskill, West Coast regional manager for Property Brokers, said there was a good spread of potential buyers at the bottom end of the market. “The majority of people are just looking for a cheap house and are trying to get into the market. The rest is made up of investors, builders, and the like,” he said.
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Maskill, who is currently selling a 120sqm home at 56 Murray Street, Greymouth, for $139,000, said he was always careful not to “over pitch” low-priced properties and made sure buyers were aware of any deficiencies. “We like to say, ‘it’s going to need some roof, some cladding, it’s going to need this and that’, so they don’t get surprised.”
On the other hand, low-priced apartments can come with enviable amenities. For $109,000, a 34sqm apartment on offer at 307/86 The Strand, in Parnell, comes with “resort-style facilities”: two pools, a gym, a spa, a tennis court, and two car parks.
Ray White agent Dominic Worthington, who is marketing the apartment with colleague Ada Huang, said low prices often got first-home buyers excited but “then they realise the parameters [of the property] don’t work for them”. They may not be able to afford the $15,000 annual cost of ground rent, body corporate and rates, or find they can’t get a mortgage.
An "as is where is" three-bedroom shack for sale for $139,000 at 56 Murray Street, in Greymouth. Photo / Supplied
307/86 The Strand, in Parnell, Auckland, is on offer for $109,000. Photo / Supplied
Investors, on the other hand, look at the potential rental return. “Investors are buying an income stream,” he said, noting that many were cash buyers and did not need to worry about getting a mortgage.
Loan Market mortgage adviser Jamie Maclennan told OneRoof that finance wasn’t impossible at the bottom end of the market. “It is not a straight out ‘no’ [from the banks] for an apartment,” he said. “It depends on the person. Everyone has a different financial position. The bank might look at how much money the buyer is making, how much deposit they’ve got or if they have other properties.”
A buyer with a 50% deposit or who can secure the loan against other property was likely to get a mortgage, he said, but first-home buyers with only a 20% deposit would need to focus on properties greater than 38sqm in size to get finance. However, those looking to buy into a building with weathertight issues would “really struggle” to get a mortgage.
Hut 16 at 449 Fisheries Road, in Glenavy, Waimate, has a $73,000 price tag. Photo / Supplied
One home that won’t qualify for a mortgage is the two-bedroom fishing hut for sale at 16/449 Fisheries Road, in Glenavy, Canterbury.
The property has a $73,000 price tag, but a buyer is purchasing a licence to occupy, not the freehold land beneath it. Listing agent Cliff Meek, from Property Brokers, told OneRoof the “banks won’t lend on it”, although the property can be insured. “You own above the ground, so the crib is your property.”
It has power, water and a shower, but no toilet. Owners can either use a chemical toilet or the camp’s ablution blocks. Camp rules also forbid living on-site fulltime. “You can come and go as much as you want,” said Meek. “But there is a set of rules.”
In the past, owners tended to be older, but the huts had risen in price in recent years and the buyer pool had changed, said Meek. “The last few buyers included a builder and a real estate agent.”
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