PHOTO: Cameron Bagrie. Photo credit: The AM Show
Three out of the four Block NZ apartments failed to generate a profit for contestants because the show’s format demands they sell at auction, a property expert has claimed.
Only two of the homes sold during Sunday night’s auction, and only one above the reserve price. A third sold after the show went off-air, at the reserve price. The fourth remains unsold.
“This thing’s a metaphor for the housing market,” property commentator Ashley Church told The AM Show on Monday.
“If you go back to season one, which was in 2012, the combined profits between the contestants was about $232,000. That was early in the life cycle of the property market. That ratcheted right up to 2017… between the contestants, they made $981,000. That was the peak of the cycle – it’s come back since then.”
Auckland property prices have cooled over the past couple of years, after making record gains between 2009 and 2017.
Church said auctions are fantastic for sellers when the market is running hot, because it gets everyone who’s interested in a property into a room and forces them to compete – and with capital gains likely, people are prepared to pay as much as they can.
“In this environment, that’s much less likely to happen,” he said, but the alternative – selling the properties via tender – wouldn’t make for good television.
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