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The latest victim in the tide of mortgagee sales is on one of Auckland's most exclusive streets.
A $4.5 million property in exclusive Glendowie's Riddell Rd is owned by property developer Kourosh Khoshkhoo and his wife Lida has been put on the market by its bank.
Described as having one of "the most magnificent views" of the Hauraki Gulf, the home has four bedrooms, four sitting rooms, three bathrooms and a swimming pool. It is described by real estate agents as an "extraordinary treasure" - a description that Khoshkhoo's friend and former business associate Andrew Krukziener agrees with.
Krukziener told the Herald on Sunday that he used to own the house, and after he enthused about it to Khoshkhoo, his friend bought the property.
Krukziener said the Khoshkoos had been hit be the same problem that was affecting most Auckland property developers. "It's impossible to get funding from anyone for anything. Everyone is in the same situation. Nine out of 10 property developers are in deep strife at the moment. It's a function of the credit crisis."
The sale comes as real estate agents advise that people who want to sell their homes need to slash their asking price by 20 per cent.
The expected figure in Auckland to attract offers is 10 per cent. LJ Hooker general manager Keith Niederer said: "It's no good dropping it $5000. If you're not going to remove the price entirely, you're going to have to do some soul-searching. And then, if you've got a $400,000 house in Auckland, you're going to have to drop it something like 10 per cent."
Peter Thompson, managing director of Barfoot and Thompson, said a drop of 5 to 10 per cent on a seller's ideal asking price could make all the difference.
Sellers needed to be realistic: "Sometimes they do need to lower their expectations."
John Ross, owner of Professionals Hutt City, said vendors needed to lower their asking price to anticipate the falling market, rather than following the market down belatedly.
Those who lowered their asking price substantially when they put their home on the market would get a great deal of interest, whereas those who dropped it incrementally might never reach the tipping point that attracted offers.
Harcourts NZ chief executive Bryan Thomson said more sellers were lowering their expectations and they were getting results.
"In contrast, sellers who refuse to recognise or accept the changed environment continue to languish," he said.
One Kingsland vendor dropped the price of her bungalow by $10,000 to $549,000 last week. The agent, Vincent Barnao of Anne Duncan Real Estate, said he had already seen the difference in open home attendance.
Barnao said the price drop was motivated by the vendor's need to sell and the work needed on the property.
"There are a lot of buyers out there but they are all looking for bargains."
But Barfoots agent Kymm Hape said auctions were the ideal way to sell.
One property on his books, a three-bedroom home on Momona Rd in Epsom, had been on the market for a year. Now, an extensive campaign promoting its auction was seeing buyers "coming out of the woodwork".
