More economic pain for latest red zoners
"But what about those sites that paid rates for years, if not decades?"
Featured commentChristchurch owners of red-zoned vacant sections, insured commercial properties and uninsured properties are being offered half their value by the government.
The announcement by Earthquake Recovery Minister Gerry Brownlee affects 65 vacant sections (vacant sections are uninsurable), 50 occupied but uninsured properties, 22 insured commercial/industrial buildings and six insured houses on leasehold land.
“We have decided to assist the owners of these properties by giving them the option to sell their land to the Crown at half the most recent rateable value,” Mr Brownlee says.
“If owners decide to take this offer, the land and any buildings on it will become property of the Crown from the settlement date.
“What the owner chooses to do with any buildings on the land up until that day is entirely up to them.”
There are also 22 insured commercial/industrial buildings in the residential red zone. The land these buildings sit on is not covered by Earthquake Commission insurance as it is not residential.
“The ongoing value of the land is significantly reduced due to earthquake damage,” Mr Brownlee says.
“In order to aid recovery and support the objectives of the residential red-zone process it has been decided to also make an offer to the owners of these properties.
"The price offered for these properties will be the most recent rating valuation for the improvements and half the most recent rating valuation for the land under option 1, or half the most recent rating valuation for the land under option 2.”
Some owners with big loans on empty sections will lose significant, if not all, their equity.
A group called Quake Outcasts, claiming to represent 50 landowners, says it will fight the decision through the courts.
“The government is not purchasing red-zone land with EQC money and so the suggestion that red-zone owners have not complied with the Crown’s insurance requirements is both irrelevant and misleading,” spokesman Ernest Tsao says.
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Comments and questions13
Just restate the first sentence. The uninsured owners of the land are being offerred half the pre quake value, which in most cases is much more than the present value. The owners are very lucky, they chose not to insure in some cases, and are now being bailed out by the taxpayer.
Uninsurable vacent sites and uninsured private/commercial properties have little sympathy in Christchurch.
But what about those sites that paid rates for years, if not decades?
They paid rates on a government or council valuation with a right to build at any time in the future according to any original zoning plan.
Sure 'land banking' or land investment is a risk, but for the government to declare a blanket 50% offer means that is all they consider the land was originally worth surely. Any rates refunds due as overpaid ?
This will make an interesting debate.
Your attitude is quite ignorant. The Red Zoning of land is a government decision. Land should not be confiscated in NZ without compensation. Do you recall the Treaty of Waitangi and the problems we have had of late ? Dont confuse the issue of the insured dwelling with the right of landowners to buy some dirt and retain ownership of it. The council is deciding to withdraw services to land they approved for subdivision, land owners needs to be compensated. The uninsured building is another issue altogether. Just wait until your beloved government try and tell the Port Hills Empty Section Owners, whose land is NOT damaged that they are going to either sieze the land by theft or refuse building permits because CCC land is a danger to the CCC approved and now privately owned subdivisions. Think about it come more Simon, and whatever you do, dont plan to buy land to build your home on.
What a joke this is, get with it Gerry, that's what you are getting paid for!
If this is the best offer you can come up with I'd rather slid my own throath!!!
Okay then, off you go. Why should the taxpayer bail you out if you didn't take any insurance? Why do you think owning a piece of land entitles you to have the taxpayer come around and wipe your b*m if it goes wrong?
These owners need to think why the Govt is offering to buy them at all. There may be merit in waiting to see if there is a later time when more leverage might be gained. For instance if an owner held out and the government was trying to redevelop the land in the future for resale the owner might be in a stronger position.
Gerry was/is right, carpers and moaners.
Move to brisbane and prove Piggy right
Seems like a reasonable offer to me. The other option the landowners have is to simply say NO and keep their properties.
What is CERA compensating them for? It not compensation for earthquake damage as they would have many believe. They are actually attempting to compensate them for the loss resulting from their red zoning decisions.
Those owners knew what would happen if their uninsured properties were damaged and ran the risk. However, they had no idea about the government's zoning plans, and anyway, you cant get insurance for compulsory acquisition or government zoning decisions.
The owners dont want compensation for earthquake damage. They want adequate compensation for CERA's zoning decision!
I thought that when we insure our home that only the replacement cst of the house is insured and not the land? In which case no one has land insurance. Can someone explain? thanks.
Most of you people comment but you have no idea, you do not have homes and familes in stuffed houses that will cost well into the hundred thousand bracket to get repaired. To make matters worse and also with retrospect I now know we live on the swamp of the waimak ....it's a friggin DUMB place to build houses, just like around QE 2 in the swamp land. For us the water is only 900 mm deep running through the soils and clays beneath you and it rocks like a bugger in a 5.5+ earthquake ... perfect jelly.
To be fair, charging the layman taxes to bail out South Canterbury Finance, Air N.Z, radio network, and all the others over the last 10 years and not actually give a stuff about the small people. If you didn't notice for a start AMI is well gone, the CEO resigned the whole nine yards, EQC is also stuffed for funds and its now up to future taxation to cover it. When ever you hear the words "southern response" .. that's yours and my tax dollar bailing out AMI .. our friends are getting a brand new house, with that bailout chequebook.. shouldn't they only be getting 3 cents in the dollar ?
I've worked out the fix for waimak district to look after everyone will only have an actual cost of 6.52 million. Its is alot but it does affect approx 160 real people and that is based on my last rates. What i think the govt ought to do is buy the land back at GV and apologise to us that in allowing subdivision of swamp they had gotten to greedy.
Thier is an old saying never judge a man until you have walked a thousand miles in his shoes ... i think people are too critical of what they actually know nothing about .. after all it was really a disaster and should the ethos be to help people?
Listen!!!
Fact: QV states RV is not market value.
Fact: Mr Brownlee chose 2007 as he states it was the peak of the real estate market.
Fact: So why did Brownlee pick 2007? (and not allow any appeals)
Fact: You cant insure land but you do pay rates
Fact:: Anyone accepting Option 1 of the red zone offer is being ripped off as the offer is not voluntary but comes with threatening consequences if not accepted and so our land will be confiscated for well under its value. International law states this is not justice.
New Zealand please support us as it could be you in this situation.