Home valuation warning amid COVID housing market and compulsory acquisitions

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Property valuations might not be keeping pace with the booming COVID housing market, leaving homeowners facing compulsory acquisition at risk of inadequate compensation, a South Australian MP has said.

The warning comes after confirmation that more than 100 homes near a major road upgrade and tunnel project in Adelaide’s south will be bulldozed.

Dozens of residents living near the final stretch of the North-South Motorway along South Road — including in the suburb of Glandore — have begun receiving letters telling them they are now facing eviction.

“To deliver this important project, more space is required than the existing road corridors,” one of the letters stated.

“As a result, it has been determined that your property will be directly impacted.”

After sustained questioning this morning on ABC Radio Adelaide, Infrastructure and Transport Minister Corey Wingard conceded that “impacted” means “compulsorily acquired”.

“We’ve sent letters to peoples to homes who will be impacted, so the short answer is yes,” he said.

“As we know the areas where we need to acquire properties, we’ll let those people know and we’ll deal with them through the process.”

Earlier this month CoreLogic data revealed Adelaide house prices rose 17.9 per cent in the past year, and 5.3 per cent in the past quarter.

Residents have expressed dismay at losing their homes, and former valuer-general and independent MP John Darley said their plight was being compounded by the fact that the valuation process for compulsorily acquired properties had recently been exposed as potentially unreliable.

Mr Darley cited the example of an elderly couple who were living in the vicinity of the controversial Fullarton and Cross roads intersection upgrade.

He said they ended up receiving $120,000 more than they were initially offered for their townhouse — but only after challenging the process.

“Both the valuer for the department and the valuer for the owner were using sales evidence as far back as December 2019,” Mr Darley said.

“Now, as we know, the way the market took off in the past 12 months — even a sale today is out of date tomorrow.

“The government offered them $680,000 for their property. We finally managed to get them up to $800,000.”

Marion Mayor Kris Hanna said he was aware of 110 homes in Glandore that had received compulsory acquisition letters — but that the council only found out when contacted by locals.

“People will be rather shocked about the degree of compensation they get, I suspect, once the government gets a valuer and says, ‘that is the value of your home’,” he said.

“You have to put up a pretty strong case to be able to vary that, so I think there are going to be some pretty upset people along the way.”

Distraught residents left in limbo

Glandore resident Barbara, who said her family home of more than three decades was at least 115 years old, told ABC Radio Adelaide’s Ali Clarke that she had received a letter telling her she was being kicked out.

“The letter was in my letterbox when I got home from work and it said my house was ‘impacted’,” she said, before breaking down into tears.

“I’ve been here 36 years and I’ve brought up two daughters here. I have a garden here I worked so hard on in lockdown last year – I’ve got fruit trees, 100-year-old lemon trees, a fig tree. So much that’s so valuable here.

“It was quite a long way from South Road when I bought the house. South Road has got closer with an upgrade in 2007, but now it’s taking over.”

Another local resident, Julie Bilskyj, is in the middle of renovating her home and said she has now had to “put things on hold”.

“All the plans went through last year, I signed the contract, I started renovating at the beginning of the year, so it’s adding insult to injury,” she said.

“I was planning to stay here well into my old age. I wouldn’t be investing as much money into my house if I thought there was a possibility of this happening.”

Local MP Jayne Stinson said she had “very distressed people start calling my office” yesterday.

“A few people were told over the phone that their land was being compulsorily acquired and that came as a massive shock to some people,” she said.

But Mr Wingard defended the government’s handling of the process, saying the option to construct tunnels was the least intrusive.

“That’s why we’ve gone with the two-tunnel option, which saves some 480 properties,” he said.

“It’s one that needs to be done. It’s a big project.

“We’ll deal with the community one on one so that they understand what’s going on.”

(Original ABC Article)