Real Estate Institute of NZ president Peter McDonald is reported to have said that in the main centres "there's a lot of growth. With [high] net migration, there's going to be a definite shortage of homes at some stage because we aren't building enough," The full article in the Sunday Star Times today reports on section sale prices dipping, but not in Auckland.
Further to our previous article - is it any wonder we're not building enough new homes when the Auckland City Council taxes each new dwelling project $25,000-$30,000? Actually, many Councils are taking what they think they can get away with. A Local Government Forum is complaining calling the contributions a "rort". But their article mainly refers to big developers. What about us? We wanted to purchase a rental property as a way of saving for our retirement. Well who wants to leave their well-earned savings in a badly-managed fund that charges fees that almost wipe any gain off? Let alone that some investment companies are not the safest place to have your savings at the moment. As for leaving it in a bank - similarly, the fees, minute amount of interest earned and taxes means your money is almost going backwards there. Land, like gold, is a finite resource and the REINZ forewarn we're going to have a shortage of housing in Auckland. Surely we can't lose if we buy or build homes to rent out?
We're wondering if we should have just bought an existing dwelling. But, that doesn't increase the number of dwellings available. Our longer term plan is to develop decent (stylish, eco-features) lower cost housing to support Kiwi home ownership at entry level (in the lower price bracket). We can understand the resentment towards the large developers and we can empathise with public support for wanting to sting them with these huge contributions - they build 'little boxes on the hillside, little boxes made of ticky-tacky' (as my father used to sing). Their developments are ugly, lacking in style and character; they shove heaps of people in to a small area - it's gross. So, yes. Let's stop them. (For instance - look at Stonefields - how tragic is that, but Dannemora, Botany, Albany - huge swathes of once-beautiful farm land is now covered in desert-coloured, tree-denuded beige-on-beige-boring sleeping boxes.)
We're not Fletchers! We can't negotiate our way out of paying the contribution.
Sunday, June 20, 2010
Friday, June 18, 2010
Council Contribution Crashes Project Hopes of Building Cheaper Than Buying
The hidden costs that jump out at the naive developer to rip a chunk out of their arse have got us. We've just been dealt a nasty blow. Yadda yadda ignorance is no excuse blah de blah, but heay this is a new policy and okay, we didn't know about it. The Auckland City Council "in accordance with Auckland City's adopted 2009 development contributions policy" is charging us $23,785.63 towards: the Council's fund to buy parks and reserves, create walks, playgrounds and develop open spaces, develop libraries, swimming pools, community centres, and to help pay for the upgrade of the city wide stormwater system. In addition, we're to pay towards improving citywide roading, creating cycle and bus lanes. So, isn't that why we pay rates? Isn't this basically a land tax?
What felt really unfair about it, is that a proportion of the calculation is worked out on the full size of the section including the neighbours front half. Because it's a cross-lease section it's treated as one title. The clerk at the Council thinks we got off lightly - the usual contribution per new dwelling is $25,000 - 30,000. Our contribution is below average because of the smaller size and value of the project. We have to pay this - there is no appeal and no way around it. If we want to pick up our building consent, this must be paid.
We hadn't budgeted this in and it's way beyond a vague amount we had as a contingency fund. When we add this on to the cost of the land and house, because it is effectively a development tax, we're up to $199,000. We still have to pay for connections and fixing up the house once on site, fencing, paving, insulation, base boards, landscaping and on and on and on. There goes the new (2nd hand) kitchen we were going to put in.
So, it's off to the bank we go for a 3 month mortgage holiday on our home and the section.
What felt really unfair about it, is that a proportion of the calculation is worked out on the full size of the section including the neighbours front half. Because it's a cross-lease section it's treated as one title. The clerk at the Council thinks we got off lightly - the usual contribution per new dwelling is $25,000 - 30,000. Our contribution is below average because of the smaller size and value of the project. We have to pay this - there is no appeal and no way around it. If we want to pick up our building consent, this must be paid.
We hadn't budgeted this in and it's way beyond a vague amount we had as a contingency fund. When we add this on to the cost of the land and house, because it is effectively a development tax, we're up to $199,000. We still have to pay for connections and fixing up the house once on site, fencing, paving, insulation, base boards, landscaping and on and on and on. There goes the new (2nd hand) kitchen we were going to put in.
So, it's off to the bank we go for a 3 month mortgage holiday on our home and the section.
Digging in the wet and cold
We've been having fun with a digger. Got a small Bobcat and have been scraping the vegetation off the house site, digging up tree stumps and ripping out old fencing. New photos at Flickr. We bought a generator 2nd hand off Trade Me to enable us to use power tools on site and at the house prior to power getting connected. We removed all the vegetation hanging over the back fence: choko vines, long grass and other weedy vines. The fence is nearly falling over now. Had to take out a noxious tree also: kerosene plant. There was an old wire fence running along the back and once the vegetation was clipped away we pulled that out. Looks tidier.
Hired a tipping trailer which was a bit of fun. We used the digger to load concrete, dirt and rubble on to the trailer and then I (the girl) heads off to the rubbish dumb, backs up the trailer and I pull the pins and thump the trailer tips clunk to the ground. A bit of dirt fell off the back but the bulk of the concrete, rubble and mud just sat there. Hmmm... so it was a bit of hard labour with the rake, then easing the ute forward, then pull more dirt and grass and rubble off the back, then ease the ute forward again... at least that was under cover. We've both had bad lingering head colds all week from working 2 days out in the cold, intermittently getting wet.
Both of us did the following 2 loads. Pst don't tell the Trailer Hire people - we got a tonne on the last load, oops (the trailer's only rated for 500kg). Each 400kg of rubbish costs $55.00 so it cost a few hundred dollars plus a couple of hundred for the digger and there's still a truck load sitting at the section waiting for another weekend. At least the site is now ready for the house to be moved on.
Hired a tipping trailer which was a bit of fun. We used the digger to load concrete, dirt and rubble on to the trailer and then I (the girl) heads off to the rubbish dumb, backs up the trailer and I pull the pins and thump the trailer tips clunk to the ground. A bit of dirt fell off the back but the bulk of the concrete, rubble and mud just sat there. Hmmm... so it was a bit of hard labour with the rake, then easing the ute forward, then pull more dirt and grass and rubble off the back, then ease the ute forward again... at least that was under cover. We've both had bad lingering head colds all week from working 2 days out in the cold, intermittently getting wet.
Both of us did the following 2 loads. Pst don't tell the Trailer Hire people - we got a tonne on the last load, oops (the trailer's only rated for 500kg). Each 400kg of rubbish costs $55.00 so it cost a few hundred dollars plus a couple of hundred for the digger and there's still a truck load sitting at the section waiting for another weekend. At least the site is now ready for the house to be moved on.
Saturday, May 29, 2010
Drainage: Getting permission from neighbours
Things have slowed down a bit. We went with the designer recommended to us by the housemovers. He has been good value. He's drawn up the site plan and renovation to the house to insert a laundry. There has been just one hiccup that delayed getting the application in to Council - the drainage plan.
There are public drains just 3 metres from where the house will be, but they are in the neighbours nice new concrete driveway. We had to get him to sign approval on to the drainage plan but he's playing catch-me-if-you-can. So to Plan B: we had to draw up a new drainage plan showing us going to the road. This will cost a lot more. We still have to try and get the neighbour to let us in to his driveway - and we'll have to do this by showing him that this option will be better for him and his tenants. Because, if we have to go to the road, we might have to dig across his entrance which might disrupt his tenants. Also, that disc at the entrance to his driveway but in line with our fenceline better not be a marker indicating that his electrics run under our fenceline - oh dear... that will be a big problem for him if he has to dig them up and move them... you get the picture.
Yes, the designer has been real good value - we wouldn't have thought of all these options ourselves.
So, the application for a building consent is in to Council. They claim a 20 working day turn around, excepting any queries (in which case they stop the clock). We are on track to have consent within the 10 weeks free storage of the house in the housemovers yard.
There's been a lot of rain over the last 2 weeks. Today we went out to the house to mend the roof with our Trade Me bought 2nd hand tiles. Unfortunately the hole over the bathroom is missing a baton so we had to use the corflute for sale sign from the section to catch the rain and head it off. The corflute signs were to patch up the broken window in the main bedroom.
With the garage off the section and the rubbish gone, the next fun thing is to get a digger, mark out the profiles for where the house is going to be, and clear the vegetation off; and, dig out some tree stumps and the concrete from an old shed.
There are public drains just 3 metres from where the house will be, but they are in the neighbours nice new concrete driveway. We had to get him to sign approval on to the drainage plan but he's playing catch-me-if-you-can. So to Plan B: we had to draw up a new drainage plan showing us going to the road. This will cost a lot more. We still have to try and get the neighbour to let us in to his driveway - and we'll have to do this by showing him that this option will be better for him and his tenants. Because, if we have to go to the road, we might have to dig across his entrance which might disrupt his tenants. Also, that disc at the entrance to his driveway but in line with our fenceline better not be a marker indicating that his electrics run under our fenceline - oh dear... that will be a big problem for him if he has to dig them up and move them... you get the picture.
Yes, the designer has been real good value - we wouldn't have thought of all these options ourselves.
So, the application for a building consent is in to Council. They claim a 20 working day turn around, excepting any queries (in which case they stop the clock). We are on track to have consent within the 10 weeks free storage of the house in the housemovers yard.
There's been a lot of rain over the last 2 weeks. Today we went out to the house to mend the roof with our Trade Me bought 2nd hand tiles. Unfortunately the hole over the bathroom is missing a baton so we had to use the corflute for sale sign from the section to catch the rain and head it off. The corflute signs were to patch up the broken window in the main bedroom.
With the garage off the section and the rubbish gone, the next fun thing is to get a digger, mark out the profiles for where the house is going to be, and clear the vegetation off; and, dig out some tree stumps and the concrete from an old shed.
Tuesday, May 18, 2010
New Zealand Architectural Awards 2010
We attended the New Zealand Architectural Awards Gala dinner on Friday night. It was a night to 'visit your dreams' or at least dream of being rich enough one day to live in an unusual and startling home. We'd never attended one of these events before and neither of us are architects - we expected only that people would be dressed up as required by the 'black tie' instruction on the invitation and that they'd show pictures of the winning buildings.
The event was held in the Auckland Museum. There was free booze, a really nice three course meal and lots of awards to be given out. The surprising element (and most welcome for us) was the unexpected amount of Maori content: Frankie Stevens was the MC and he injected Maori protocol, language and humour throughout the night; there were also several Maori recipients of awards and some Maori clients whose buildings were winners, such as the Mantell's Wanaka Lodge. Deidre Brown won an honorary award for her book on Maori Architecture and it was great to see her again.
The New Zealand Architecture Medal went to Ironbank which we could only concur with.
So inspired were we, we've started designing our own eco-friendly, cheap-as, container home to be built on the next cheapest piece of land we can find bordering an industrial area, and perhaps overlooking the Manukau Harbour.
The event was held in the Auckland Museum. There was free booze, a really nice three course meal and lots of awards to be given out. The surprising element (and most welcome for us) was the unexpected amount of Maori content: Frankie Stevens was the MC and he injected Maori protocol, language and humour throughout the night; there were also several Maori recipients of awards and some Maori clients whose buildings were winners, such as the Mantell's Wanaka Lodge. Deidre Brown won an honorary award for her book on Maori Architecture and it was great to see her again.
The New Zealand Architecture Medal went to Ironbank which we could only concur with.
So inspired were we, we've started designing our own eco-friendly, cheap-as, container home to be built on the next cheapest piece of land we can find bordering an industrial area, and perhaps overlooking the Manukau Harbour.
Monday, May 17, 2010
Garage Gets Taken Away
The draughtsman has the building consent application to council underway and the garage is being dismantled.
The house movers rang and left a message - just wanting to catch up, see if things are on track. No doubt wanting to discuss the 2nd installment due within 14 days of signing of the contract.
The rubbish pile is dwindling, and the new tenants in the front house don't seem to be living there yet.
Progress photos are here.
The house movers rang and left a message - just wanting to catch up, see if things are on track. No doubt wanting to discuss the 2nd installment due within 14 days of signing of the contract.
The rubbish pile is dwindling, and the new tenants in the front house don't seem to be living there yet.
Progress photos are here.
Sunday, May 16, 2010
The Hard Labour Begins
This weekend we started clearing the rubbish from the section: one van load on Saturday and one van load on Sunday ($55 ea). There's 1-2 loads to go. We also bought 100 secondhand roof tiles and went and picked those up (from way over West). They need cleaning with bleach and water and a scrubbing brush (water blaster would be quicker).
The garage sold - unbelievably for $171.00. They come to dismantle it and take it away tomorrow. Excellent to be able to trade so easily via Trade Me - this will help offset the rubbish fees.
The draughtsman is looking at the house tomorrow and then coming to look at the section and pick up our plans which we've drawn up on SketchUp which is free to download 3D Modelling software.
The surveyor is booked to confirm the boundaries some time early this week also.
Progress photos to follow.
Being Neighbourly
Some new tenants were moving in to the house in front, when we arrived at the section on Saturday. Don't know what happened to the Indian couple that were there for only 1-2 weeks? When we said we were taking away the rubbish they shot in to the garage to look through what was there. We said, take whatever and pointed out the good stuff (plates, some lengths of fabric, some kitchen stuff which we'd set aside to put out for free removal). Sadly, they asked for the couch and double bed mattress and base which were dry, but who knows how long they've been in the open-air garage? I'm covered in flea bites from working in the garage the weekend before - I hate the thought of anyone sleeping on that bed. Am searching on Trade Me for a better bed for them. But, would they be offended if we went back with a slightly better crap bed and said give us that other horrible one and we'll dump it? Maybe they won't want to give it up because they still don't have enough beds?
The garage sold - unbelievably for $171.00. They come to dismantle it and take it away tomorrow. Excellent to be able to trade so easily via Trade Me - this will help offset the rubbish fees.
The draughtsman is looking at the house tomorrow and then coming to look at the section and pick up our plans which we've drawn up on SketchUp which is free to download 3D Modelling software.
The surveyor is booked to confirm the boundaries some time early this week also.
Progress photos to follow.
Being Neighbourly
Some new tenants were moving in to the house in front, when we arrived at the section on Saturday. Don't know what happened to the Indian couple that were there for only 1-2 weeks? When we said we were taking away the rubbish they shot in to the garage to look through what was there. We said, take whatever and pointed out the good stuff (plates, some lengths of fabric, some kitchen stuff which we'd set aside to put out for free removal). Sadly, they asked for the couch and double bed mattress and base which were dry, but who knows how long they've been in the open-air garage? I'm covered in flea bites from working in the garage the weekend before - I hate the thought of anyone sleeping on that bed. Am searching on Trade Me for a better bed for them. But, would they be offended if we went back with a slightly better crap bed and said give us that other horrible one and we'll dump it? Maybe they won't want to give it up because they still don't have enough beds?
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