It’s hard to believe that we’ve reached the four year anniversary of the Canterbury earthquakes that devastated our beloved city. As one of the original real estate agencies in Christchurch, we’ve seen a lot since we opened the Cowdy doors for business in 1979, but we never could have predicted the amount of destructions we saw, even in our many years of operating in Canterbury. And despite the trials and tribulations we’ve faced, and those that our dear friends and family are still facing through the changes to the city, we are deeply connected to Christchurch and we’re going to see this rebuild through to the end. After all, we’ve been in Christchurch for 36 years and we plan on being here for at least 36 years more!
We’ve learned a lot through the difficulties we’ve experienced over the last four years, and we need to look back to those first days of terror and uncertainty to see just how far we’re come.
Christchurch Property Matters
After the quakes of 2010-2011, many Cantabrians didn’t know where their property stood in the scheme of things. All sectors of the community struggled to understand what happened, but they all went through similar challenges and achievements as progress was made to start the rebuild. The property market itself was on shaky ground, so to speak, as no one knew how the catastrophic events were going to affect house sales and house prices. The outcome of a single day was hard enough to predict considering the hundreds of shakes that would rattle the homes and people still standing. Most of us just wanted to get through the day, much less start considering whether or not we were going to lose our life savings on the properties we owned. With time, all wounds heal. And as people from all over the world have come to Christchurch to help us with the rebuild, the property market has healed too, to the point where it’s actually thriving.
You win some, you lose some
After the 2011 earthquake, CERA stepped up and helped to map Christchurch into four zones: red, orange, green and white, with each colour representing the safety of the structure and determining whether or not the land was damaged beyond repair. Driving through the streets of Christchurch and seeing entire neighbourhoods marked with red stickers was enough to send a lot of staunch Cantabrians packing. Some house owners felt lucky enough to escape with their lives and sold their properties to government to free themselves financially to seek a new life elsewhere. Others have stayed on with the hope that their beloved family homes would and could be rebuilt. Close to 8000 of these family homes were red stickered. Many still stand in darkened streets waiting to be demolished while many more have already been taken down, changing the landscape and bringing a bit more hope to our city while the rebuild continues.
While the ‘Residential Red Zone’ was met with much opposition from the community, it has been integral to the rebuild and to the red zone property owners themselves. This gave red zone property owners the chance they needed to move on with their lives. Once they had signed the sale and purchase agreement with the government, they were able to buy new, safer and more secure houses that would help them rebuild their lives. Close to 7000 property owners sold their homes to government for a staggering amount: $989 million. By the end of 2012 only 1300 of these properties had been demolished. Red zone land isn’t safe enough to be built upon again, so for now the cleared areas remain empty until long term decisions are made with regards to city planning.
Solid ground? Solid gold!
Property owners in the Green Zone are obviously luckier as the land has been cleared as safe and houses can easily be repaired or rebuilt. CERA implemented Technical Categories to help home owners and contractors working on the rebuild to understand the land they were working with. These categories are important in a city like Christchurch that now has a known fault line as they help to describe how the land will perform in future earthquakes helping builders determine the foundation systems required for maximum safety.
There are three main categories and each of them have an effect on the property market in Christchurch:
- Technical Category 1 (Grey Zone) indicates that land damage from liquefaction is unlikely in the future.
- Technical Category 2 (Yellow Zone) indicates minor or moderate land damage.
- Technical Category 3 (Blue Zone) indicates moderate to significant land damage.
According to CERA, roughly 28,000 of the homes in Christchurch as classified as Category 3 meaning there are a lot of people looking at serious repairs and, in some 10,000 cases, complete rebuilds. Values increase and decrease in relativity to the amount of damage the land in a certain area has sustained. Obviously properties situated in the Grey Zone are sitting pretty as they require the least work and future damage is less of a probability making it a great area for house sales.
The Yellow Zone isn’t lagging far behind even with the moderate damage that accompanies it, whereas the Blue Zone’s price sales have been declining steadily as more light is shed on the issues with the land there. Buyers also know that they can offer less for houses in areas that aren’t in high demand, so median prices drop as a result of this.
But there’s good news
While some parts of Christchurch struggle with falling house prices and land problems, other areas are thriving. The best part about this is that it means our Christchurch residents are reconstructing their lives by reconstructing their homes. And this is great news for everyone!
As you know, the eastern suburbs were the hardest hit in both of the earthquakes, and this led to the displacement of many families and an increased demand for properties on the west side which was largely unscathed. This shortage of properties combined with a thriving sellers market resulted in a massive increase in property values which in turn has managed to drive up the total value throughout the Christchurch region.
Show me the money
As I’ve mentioned some suburbs are doing better than others and are worth keeping an eye on if you’re considering a move in 2015. Spots to watch are:
As buyers in this area are willing to pay a higher price for a guaranteed peace of mind. Places like
- Hoon Hay
Are holding steady with a lot of buying and selling activity while Bryndwr, Parklands and Linwood have dropped significantly. There are suburbs in the east where prices have dropped so much that their sales volumes are the lowest they’ve ever been.
Get Outta Town!
While house values are rising within Christchurch, values are also increasing particularly in the Waimakariri and Selwyn Districts. Surprisingly, areas as far away as Timaru and Ashburton are also seeing a rise in property values, though not at such a rapid rate. Some people want to leave, and no one should judge them. We all react to catastrophic events differently, and for some Christchurch residents, their recovery comes in the form of a more drastic move. Who is to say they won’t move back once the rebuild is complete? We’ll be here to welcome them with open arms.
Build it and they will come…
There is an incredible amount of money being directed at Christchurch for the rebuild which enforces the rumour that Christchurch is going to be a world class city by 2025. New Zealand as a whole is going to benefit from the rebuild, and this will no doubt help to drive up housing values all over the country.
The innovative designers of our ‘Future Christchurch’ have created a detailed recovery plan that includes key projects to drive visitors and migrants to our vibrant city such as:
- a convention centre to attract big business
- a cultural centre to promote local heritage
- a retail precinct featuring iconic Christchurch businesses
- a health precinct for people to continue on their healing journey
- a justice and emergency services precinct
- a performing arts precinct to showcase our local artists
- sports facilities for community engagement
- transportation facilities to get around the city with ease and style
At the end of this rebuild it’s our dream for the people of Christchurch to reflect upon the earthquakes as an opportunity for transformation. And we’re proud to be a part of it.
Nick shares his families’ professional and ethical goals and is excited to be part of the hardworking and high achieving team at Cowdy & Co. Earning a degree in Art History and Management from Otago, followed by a move to Wellington gaining experience as a sales manager for a respected New Zealand retailer, ensures Nick is well suited to a future in Real Estate. Having travelled extensively worldwide, it is easy to say that Nick is a well-rounded individual. Nick has a relaxed and approachable style, as well as a commitment to getting the job done properly. This approach is an asset to both purchaser and vendor.