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Willems questions 2007 valuations


Canterbury Property Investors Association president Kim Willems has given a cautious welcome to Government plans to buy 5,100 Christchurch homes, though she questioned the 2007 valuation the Government has adopted.

"I think people are going to have to be quite careful about that they look at and see whether it's going to be the best option for them.

"The concern would be that if they're paying out on 2007 valuations, we were due to have valuations in September that were deferred so you're talking about valuations that were now four years old. Whether they've got much relevance to what these properties would have been worth prior to September 4 last year it's very hard to know," she said.

"Most people expect their homes to go up in value."

Willems said in the wake of the earthquakes property investors in Christchurch were suffering as there was a "glut" of residential properties to rent on the market.

"There's a lot of vacant rentals, and a lot of really sound rentals not with earthquake damage that nobody wants to live in. They're sound properties and a lot of our landlord investors are really finding it tough - and they're experienced investors. They've just never had this type of situation before."

She said that while the residential property market was weak at present, Association members that had diversified into commercial property were faring much better as demand was higher due to the damage inflicted on the CBD.

However, Willems does believe the residential market will pick up once reconstruction work gathers steam.

"You expect logically that demand will start to increase as contractors move in for the long haul, but that demand isn't here yet."

Source: Landlords.co.nz