I couldn't resist posting this. it's a must Read!
Last Sunday night’s finale of Channel Nine’s The Block was a prime-time portrayal of a property crash. Talk about reality television – three of the four properties didn’t reach their reserve.
The only thing that saved the show was the young bloke proposing to his girlfriend, whose tears of joy transformed into a tantrum not ten minutes later when their property was passed in. (Mark that down as your first lesson, son.)
‘What a bloody waste of time’, said one of the deflated contestants. But it could have been worse. It could have been their money. If they’d put their heads on the block, they’d probably be bankrupt:
Average purchase price including stamp duty: $950,000
Major renovations: stumping, plumbing, rewiring: $300,000
Cosmetic renovations: $100,000
Average total cost per house: $1,350,000
Leading independent property valuer Louis Christopher claims that the couples would each have lost up to $500,000 – and that figure doesn’t include their three months of labour.
It couldn’t have been a worse advertisement for the property pushers who continually talk up the most overvalued property market in the world in the mass media.
After all, they had a pretty good marketing campaign – the agents had 30,000 people through their open for inspection, and 3.4 million people turned up for the auction (okay so there were a few sticky beaks), and they still couldn’t snag a decent price.
So what happened?
Well, while the contestants learned how to build a bathroom, they failed to show them the tricks and tools that developers use every day to push their dud properties on to poor old punters. Hang on a minute – that sounds like a rolled gold, follow-up series: The Block, Dodgy Developers Special.
By Scott Pape August 26th 2011
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