Sheree and Ryan Brinch bought a section they wanted to build their dream home on, but it's lately felt like they’ve fallen into a pit of despair.
It was 900-odd square metres on the edge of Christchurch, slight slope, all day sun.
The couple have three cats and this section also cleared an important threshold - the kittycat squishability test. It had to be a safe, quiet neighbourhood.
“They were poor, homeless animals and we can give them a good home,” Sheree told Fair Go, with a giggle.
Relax. The cats are fine. But the couple had a problem.
Their plans for that forever home were derailed when they got around to final pre-construction testing for the house.
Initial geotechnical work with a hand-drill to spec up the house foundations revealed buried topsoil and material - suggesting uncertified fill was present on their property.
Traces of building material - concrete, glass and charcoal - hinted that there could be more buried there. They weren’t aware of this when they bought the place and didn’t hire their own geotechnical expert before buying. It turns out the land wasn’t suitable to build on.
“It's better for us to leave it untouched until we've got the funds or someone's willing to give us a hand and help us solve this problem.” Ryan told Fair Go.
The couple were gutted - it was seven years after they bought, thanks to the quakes and soaring construction costs that finally settled down. They’ve watched others buy, build and get on with life.
“You either smile or cry about this really, “ Sheree told Fair Go.
Trouble is - there was no mention of fill on the documents they inspected before purchase - it was clear on the LIM report and there was nothing adverse in the Council property file.
This should have given them no comfort though. “It is never going to be a guarantee that the land is actually fit to be built on,” according to John Gray from the Homeowners and Buyers Association.
HOBANZ says it can be very complicated to prove who left a mess - developers sometimes work with special-vehicle companies that don’t last long after the subdivison is sold. Councils are not always aware what goes on after they give consent.
“It is buyer beware, purchasers need to do exhaustive due diligence. They need to understand the risks,” John said.
Since the 2011 earthquakes, buyers in Christchurch are much more aware of the underlying ground. Christchurch City Council told Fair Go that the chances of this happening have diminished and allotments will generally be able to be built on.
“Testing typically occurs on each allotment in a new subdivision as a representative sample. However, there is still possible variation within allotments that has not been tested.”
Meaning, where they test could hit a bad or good bit, but what’s important is that a buyer tests the ground for themselves, ideally where they plan to build.
“It comes back to geotechnical information and having an understanding of what is your proposed building platform as to whether or not you'll incur significant and sometimes bank-breaking additional costs to actually put the foundations in,” John Gray from HOBANZ said.
Back to the Brinch plot and their dreams. - As luck would have it, the developer of the land turned out to be a very decent human when Fair Go got involved.
Fair Go has chosen not to name the director, who says dumping fill would in his view be professionally unthinkable..
“The Developer, Engineer, Contractor and Project Manager together with Council Officers, would all have to have suffered a brain storm to “fill” the site and then not compact it,” he said.
He denies liability for the trouble with Shree and Ryan’s lot, but also offered a very generous solution. The company will bring in its contractors and pay for up to $30 000 worth of earthworks.
His advice to others mirrors the Councils’ and HOBANZ guidance – get a geotech report before you buy, just as you’d have a house inspected before purchase - even a brand-new one. The costs can be high - $5000 plus - but the cost of fixing a problem after you buy can be many times higher.
DUE DILIGENCE CHECKLIST
MOST IMPORTANTLY, GET GOOD ADVICE – probably from a lawyer. What follows is just some general guidance that you may want to include in conversations about your prospective purchase BEFORE YOU SIGN AND BUY. We note that Fair Go aren’t property experts and none of this should be confused for advice, it is just intended to help you ask the experts the right questions.
A LIM report – from the Council. Make sure it is addressed to you.
Building inspection and surveyor report - same as for the LIM report - get it in your name. Also be aware what that doesn’t cover – like the drains. Where exactly do they run and what shape are they in?
Title, easements and covenants review – in case there’s anything you can’t do on the land, or anything you must let someone else do (access for fibre, drains, future road widening).
Insurance - can you get insurance for it? What are the hidden costs like retaining walls?
Finance and funding –If you’re just chinning the bar to afford the purchase, you may be tempted to cut costs on things like the geo-tech advice… Risky.
Personally visiting and inspecting the site – talk to the neighbours if you can.
Reviewing the relevant District Plan for land use rules - not only to see what you can do but also what others might be able to. What could the neighbours build right next door, or in between you and that view?
Request and review any EQC and private insurance assignments – what’s the history and are any repairs up-to-date? Not just for Christchurch as EQC handles slips country-wide.
An independent valuation - so you’re comfortable with what it is worth?
If you are buying bare land - where do the services like power, fibre, and so on, stop and how much will you pay to hook up your section?
And of course – a geotechnical report if you are buying bare land, to check the surface and subsurface conditions and materials. Don’t just assume your bit is as good as the neighbours, or as good as new because it has just been subdivided.