Developer stuns home buyer with sudden price hike
Purchaser who can’t pay the extra is furious at being forced back into an overheated property market. Maria Slade reports. Stroke symptoms
An Auckland woman is ‘‘damn angry’’ at losing the chance to own her first home after the developer building it put the price up by 20 per cent.
The woman bought an apartment off the plans in the Takanini Central development in South Auckland almost a year ago, and has been waiting for construction to start ever since.
Then suddenly in early June she got a letter saying the final purchase price of her two-bedroom apartment had skyrocketed from $450,000 to $540,000.
Developer Equinox Group blamed ‘‘significant additional construction and infrastructure costs’’ including ‘‘new council requirements’’.
It’s not the first time Equinox has hiked the prices on a proposed development.
Last year it offered buyers of luxury apartments in the Orakei Bay Village complex their money back because lengthy delays and escalating costs had pushed prices up by 30 per cent.
Buyers said they felt misled by Equinox chief executive Kerry Knight.
The Takanini buyer hasn’t got the extra funds and so is having to cancel her contract and take her 10 per cent deposit back.
The worst part was that it left her still trying to buy in the overheated Auckland property market.
‘‘A year later and a climate a year worse, and we’re having to start all over again,’’ said the woman, who did not want to be identified.
However, Knight said the contracts A year later and a climate a year worse, and we’re having to start all over again. were always conditional, and Auckland Council was to blame for the cost over-run.
Equinox had been ‘‘left, right and centre’’ with the council over the infrastructure needed on the 17ha block, and still didn’t have a start date, he said.
‘‘They just haven’t known what they’re doing with the stormwater solution because Takanini is very low-lying and doesn’t naturally drain.
‘‘Only last week did they come back and wanted an expanded flood plain and easement that we hadn’t bargained on and didn’t know anything about.
‘‘There’s a myriad of things this that just goes on and like on. There’s no master from council.’’
Meanwhile construction costs had also kept rising, he said.
The proposed $14 million development of 32 apartments, 18 retail shops and live-and-work units is part of the wider Takanini Central complex which also includes 88 houses and an industrial area.
Work on the houses has begun but the stormwater holdup would also determine when Equinox could get final sign-off on those, Knight said.
Craig Mcilroy, Auckland Council’s general manager of stormwater, said it was currently working on various stormwater projects in the area.
‘‘This includes plans to acquire land designated for permanent stormwater infrastructure,’’ he said.
‘‘Rather than holding up development until we are able to purchase this land, where possible we work with developers to come up with interim solutions.
‘‘In this case interim drainage solutions need to be put in place to ensure the neighbouring properties are not flooded.’’
Consumer New Zealand said escalating costs were one of the many risks associated with buying a property off the plans.
‘‘The longer a development takes to get off the ground, the greater the risk that there’ll be additional costs for the buyer,’’ it said.
‘‘It’s vital for consumers to get good legal advice before signing a sale and purchase agreement so they fully understand these risks.’’ planning at all