Our house hunt continues. One thing that strikes me is how many many many houses in the “entry level” bracket are in a dire state of repair. Rotting weather-boards, visibly cracked concrete piles, and so on. When I was pregnant we looked into tendering for a house but the builder said the repairs would cost so much that it’d be better to knock it down and start again.
What interests me about these houses is how they got like that. Was it owner-occupiers who were just planning a quick flick for capital gain after a few years, maybe doing some cosmetic stuff but not the major things, possibly because they had no spare cash for repairs after paying the mortgage? Landlords who figured there was no point doing repairs because the outlay wouldn’t be recouped in higher rents and a higher sale price?
It’s a fascinating feature of our housing market that it’s considered perfectly normal for the land value to be several times the value of the “built improvements”. And it’s land values that are on the increase. Buy a dump to rent out to students, do nothing, sell it after several years and bank the tax free profit. Someone else will buy it and do the same. What the hell?