Auckland floods: Buyout offer to homeowner $180,000 under CV

Tracey Pilgrim says she's fighting for answers and a fairer buyout offer for her Rānui home damaged in last year's Auckland Anniversary floods. Photo / Sylvie Whinray

A West Auckland couple believe they “can’t seem to get a fair go” after authorities offered to buy their flood-damaged home for $180,000 less than its council valuation.

Rānui residents Tracey and Mike Pilgrim are among families who have been homeless since last year’s Auckland Anniversary storm after floodwaters swamped their Ulrich Drive house.

Following the floods, the home’s location was deemed a risk to life in future flooding events and qualified for a Government buyout.

Council valuers subsequently offered the couple $835,000 for their property, well under its $1.02 million CV.

Auckland Council says the offer is fair and its staff have explained the valuation process to the family.

However, Tracey is “gobsmacked” by the valuation, saying the couple aren’t being given a reasonable answer about why it is so low.

Instead, it’s been a take-it-or-leave-it situation, she said.

“We have no voice and no power, and we’re just told what to do,” Pilgrim said.

Auckland Council has been scrambling to respond to the disaster.

Four people died in the January 27 storm that led emergency teams to rush to more than 700 calls for help as dramatic photos emerged of rescues, landslips and cars floating down streets.

With thousands of homes damaged, 681 properties have so far qualified for a Government buyback. Of those, 471 owners have received offers for their homes.

Independent valuers set the prices the council offers homeowners based on what they believe a property’s value would have been on January 27, 2023 – the day before the storm.

CVs, on the other hand, are estimates of a property’s value as of July 2021.

Tracey and Mike Pilgrim have stripped their home back to its bare bones since the Auckland Anniversary floods as they work to repair it a second time, having already renovated it following a 2021 flood. Photo / Sylvie Whinray

While house prices have dropped since the CVs were done three years ago, Pilgrim said her home’s value shouldn’t have dropped so much.

That’s especially the case when she talked to three direct neighbours who she said were offered buyout values only $10,000 to $30,000 below CV.

Yet unlike those homes, the Pilgrims’ property had also been damaged by an earlier flood in August 2021 that took place a month after the CV valuation date.

During that flood, the family had to rescue Pilgrim’s 91-year-old mum from a granny flat and carry her in her wheelchair above the flood waters to safety.

Following the flood, the family’s insurer made a settlement payout, but the bank used it to pay down the property’s mortgage.

Working at night and at weekends over the next year and a half, the couple renovated their home at their own expense.

Pilgrim said they added a new roof and bathroom, along with underfloor, ceiling, and wall insulation, among many other improvements.

They had almost finished when last year’s Anniversary Weekend floods hit, causing them to lose everything again.

Tracey and Mike Pilgrim feel like they aren't getting proper answers from Auckland Council. Photo / Sylvie Whinray

In total, Pilgrim estimated the couple had spent $250,000 on improvements but these hadn’t been taken into account by the council’s buyout offer.

By contrast, many of the neighbouring homes were older with no renovation improvements and yet had been offered prices close to CV, she said.

Finding out why this was the case had been a bureaucratic nightmare, Pilgrim said.

The family had been forced to hire their own independent valuer, who valued their property at $90,000 under CV.

Pilgrim felt this value was also low because the valuer had been bound by what she believed were council conditions limiting how high the value could be set.

Hiring an independent valuer cost close to $3000 and she’s been told it will cost at least that much again to have them sit down with Auckland Council’s valuer to try to negotiate a new buyout price.

Yet the Pilgrims will not be able to sit in on the meeting, adding to the feeling they are being kept in the dark, Pilgrim said.

Auckland Council said property valuations typically take into account upgrades and improvements only if they have building consents.

Craig Hobbs, from the council’s natural and built environment section, said previous storm damage that occurred after the CV was set and before the Auckland Anniversary floods struck would have affected the price the couple was offered.

He said copies of the valuations used to make buyback offers are sent to homeowners and they are also supported by “a dedicated property adviser to walk them through the process”.

However, owners are not permitted in meetings between the council’s valuer and valuers owners hire because it is important to “uphold the independent nature of valuations” in a way “not influenced by either council staff or homeowners”, Hobbs said.

If owners do not agree with the amount the valuers decide in this meeting, “they can opt for a valuation dispute which produces a binding valuation”, he said.

Owners involved in the buyout process also get a $5000 one-off payment for professional services that could, for instance, be used to hire an independent valuer, he said.

The Pilgrims feel the process has added to a nightmare roller-coaster they’ve been on for years.

Still stuck in temporary housing, there was “little to no joy” in their day-to-day lives and the council’s offer added to the weight on their shoulders, Pilgrim said.

She hoped they could get a better offer and clearer answers because the fact their neighbours had been given values close to CV and they hadn’t was “completely bewildering”.