Our abandoned land
An abandoned and weatherworn block of 12 one-bedroom flats for sale in King Country will be lucky to fetch $100,000.
Its beige exterior has discoloured, the interior has been vandalised, its windows are shattered and apart from the occasional troop of squatters – it’s been empty for years.
They’re eerie and romanticised in films, but abandoned houses can mean millions in unpaid rates for local governments.
And as a last resort, councils can demand the sale of a property to pay rates arrears.
The block of flats in Taumarunui is one of dozens of abandoned or in-debt Waikato properties to be put up for sale by councils over the past 10 years.
South Waikato District Council has processed seven rating sales over the past decade, three of which were abandoned properties, one vacant land and three due to rates arrears.
Meanwhile Taupo¯ District Council processed seven rating sales, five of which were abandoned land and two rating sales.
The sales amounted to a total of $753,000, with the most expensive property selling for
$230,000.
The Waikato District Council processed two rating sales over the past 10 years, including an abandoned property in Raglan, which Council sold for $240,000 in 2014. The other was an unoccupied house in Huntly, which sold the next year for
$121,300.
In, 2009, the Ruapehu District Council put more than 30 plots of abandoned land on the market in a bid to recoup rates.
It currently has two abandoned properties – including the block of flats – for sale. The other is a block of land. The block of flats, built in 1925, has about $100,000 in unpaid rates, council’s financial controller Alan Young said. A company had turned the block into the one-bedroom units years ago, he said.
A decade ago, the 1512 metre squared property had a capital value of $500,000. It had slunk down to about $150,000 by July 2017. And it will take a lot of money to repair.
‘‘All the doors have been taken off and the windows broken. It’s just virtually the super-structure there,’’ Young said.
‘‘If we sold [the flats] for more than $100,000 – which is very unlikely because of the state of it – then maybe they [the company] might get a little bit back.
‘‘People have squatted on it over the years ... It’s a bit of an eyesore.’’
It’s also an unusual example of an abandoned property or rating sale, Young said. More often, it’s small properties or bare land owned or passed down by someone who has died. They become overgrown and accumulate thousands in rates.
After three years, they can be declared abandoned.
But council will always ‘‘bend over backwards’’ before resorting to an abandoned land or rating sale, communications manager Paul Wheatcroft said.
And usually, the sale doesn’t even cover the unpaid rates.
It’s especially hard for small rural councils – such as Ruapehu – depending on rates as a main income stream, Wheatcroft said.
When those go unpaid, there’s a gaping income deficit, Wheatcroft said.
However, when council reaches the last resort of an abandoned land or rating sale – there’s usually a lot of interest.
Cheapness, plenty of employment in the area and the district’s lifestyle probably play a part in that, Wheatcroft said.
It’s hard to say why properties are abandoned and a rare occurrence, revenue manager Taupo¯ District Council Tony Wilkinson said.
‘‘The owner – we can’t find them.
‘‘They’ve either passed away and there’s no will and no one to come forward.
‘‘Not many people walk away from property they’ve purchased.’’
Although, Taupo¯ District Council did recently – in 2018 – sell two shambolic properties declared abandoned Wilkinson said.
A section of land in Kinloch sold for $230,000 and a run-down house in Mangakino was snapped up for $81,000.
‘‘It was a really broken house,’’ Wilkinson said.
‘‘All of the other three [abandoned properties sold] were really run down houses in Mangakino, pretty derelict.’’
If Council sell the house for more than the rates owing, the decision with what to do with it falls on the Public Trust.