Move a house to own a home
Is a relocatable home a way to get onto the property market? Joanna Davis finds out how viable it really is.
Looking to buy a house for less than $100,000? You know there’s going to be a catch. In this case, the (very big) catch is that you also need your own land to put it on, and you need to pay removal fees and rebuild costs once the relocated house is on site.
Despite awhole TV show on Moving Houses (hosted by Clarke Gayford last year), this is not an easy step up onto the housing ladder, and it will not appeal to everyone.
But Trade Me property sales director Gavin Lloyd says listings for houses for removal have jumped 93 per cent in February, when compared with February 2021. There are more than 200 properties listed for removal on the site.
As with most of the housing market, prices for houses for relocation have also jumped in the past two years. Trade Me figures show the average asking price for a property for removal on the site in February was $88,941.
Who buys a second-hand house?
Warren and Janene Kershaw moved a three-bedroom 142 square metre house to their holiday park in Waianakarua, Oamaru, in November 2019 – before the prices increased – and are slowly doing it up.
Previously, they have built five houses new, but Warren Kershaw is a big fan of the second-hand process, which he says is better for two reasons.
‘‘Cost is one. I reckon it cost half compared to building,’’ he says. ‘‘The other side is we have a lodge and buildings about 50 metres away, so we wanted something that would look ‘in keeping’. Something new would have looked wrong.’’
They are still doing up the interior of the home, although they were able to move in within amonth of it being put onsite.
Kershaw estimates the whole thing will cost $250,000 once completed: ‘‘That’s on the high side. It could even be under that.’’
He says dealing with the right company is hugely important. King House Removals made the process easy, he says.
‘‘There are a few sharks out there. Honestly, as long as you pick the right company to deal with I’d totally recommend it to first-home buyers.’’
New Zealand Building Removals owner Shane Paul says most people’s motivation for sourcing a relocated home is financial.
‘‘People are looking at second hand as a better option: It’s a more cost-effective way than building new. Especially since Covid when the price of building a new house has doubled.’’
Howmuch does it cost?
The price people pay for a relocatable home has increased – there are no $10,000 bargains around these days, Paul says.
Trade Me says asking prices have jumped in the past year, sitting at an average of $88,941 as of February, a 41 per cent increase when compared with February last year.
The cost to actually move a home and place it on new foundations varies hugely depending on the age and construction of a house, but recent examples include a 170sqm house being moved 140km between Nelson and Picton for $130,000, and a twostorey house for $200,000.
Paul’s company, which is based in Christchurch and has a satellite yard in Auckland, moves about 50 houses a year, including about six between islands.
He says the satisfaction for him is seeing people getting into a house they can afford,
‘‘because there’s so many who can’t at the moment’’.
He says it’s a shame that it’s almost impossible to get a home loan on a relocatable house.
Can you get amortgage?
John Bolton, chief executive of mortgage broker company Squirrel, says borrowing is much more challenging for relocating homes.
‘‘For the land, you can borrow up to 80 per cent if it’s standard residential land with services connected, but if it doesn’t have services, which is often the case in rural areas, you need a 40 per cent deposit.’’
He says banks don’t consider a relocatable home suitable security for a loan until it’s ‘‘on the ground, on piles, fixed to the ground’’.
‘‘It’s very, very challenging for first-home buyers, almost
impossible. A lot of investors do it, because they’ve already got equity in their existing property.’’
Bolton warns that cost blowouts in renovating, especially for older homes, are to be expected. ‘‘People under-estimate the renovation costs on old properties – but they have lots of hidden issues.’’
A home with ready-made character
Leigh-anne and Andrew Peake could have bought or built when they moved from Waikato to the vineyard they own in Lowburn, Cromwell, but they wanted a home with character.
The two-storey 1930s home they ended up buying had been written off after the Christchurch earthquakes. Budget played a small part in their decision to buy relocatable, but mainly they were looking for a character home.
‘‘We just like homes that tell a story and have a homely feel, rather than a brand-new house,’’ Leigh-anne Peake says.
It took them three years to renovate the four-bedroom 275sqm house.
They were so pleased with the process that they also relocated a self-contained sleep-out to use for bed and breakfast accommodation.
Peake and her husband and teenage son had been living in Cambridge, Waikato, in a 10-year-old home before the move south.
They had owned the land in Central Otago for 16 years, and have moved their valais blacknose sheep breeding operation south with them.
They have done a lot of work ensuring the renovation has the house in keeping with its era, for example by restoring wood panelling, chandeliers and appropriate wallpaper.
‘‘It took longer than we thought,’’ Peake says. ‘‘And, it’s important to get a builder who respects renovations. A lot like to only build new stuff.’’