The South road extension is in full swing and as Adelaide conveyancers our attention has been drawn to a column in The Messenger highlighting the plight of homeowners whose properties are being compulsorily acquired by the government.
Messenger deputy editor, Chris Day, says in his column, In real life, a castle’s price must be right, the government’s hands are tied when it comes to compensating property owners for the true cost of moving.
As Adelaide conveyancers, we know the costs are many when it comes to buying and selling property, especially if you are relocating at the same time, so let’s take this story as an opportunity to prise apart the various costs that are easily overlooked.
And then we might ponder the difference between choosing to embark on a move and having one forced upon you.
Knock knock. Who’s there? It’s the government, we need your house
The sad fact of life during a development phase of a city is that transport routes need modification and that means governments can enforce their right to ‘acquire’ property that lies in the way.
As Chris Day points out, the government has spent $100 million buying property along South Road and having lost the fight to refuse to sell, property owners are gearing up to at least fight for a better deal.
What some property owners are asking for is not just the market price for their properties but for some extra money to compensate them for the upheaval and other expenses.
Tell ’em they’re dreaming
As fellow South Australians, it is not hard to empathise with these property owners and with Chris’ suggestion that many of us wouldn’t mind paying a few dollars extra in car registration to cover a little extra compensation.
But as Chris notes: Unfortunately legislation prevents the government paying people a premium for turfing them out of their homes.
We have written previously about being wary of buying property close to any transport corridor that could likely be expanded in the future, see The road more travelled: Real estate lessons learned from north-south corridor property acquisitions, but that is of little comfort to people already in situ.
For the rest of us, their plight highlights the importance of taking a conveyancer-like approach to considering the costs of moving house.
Moving house means moving money
The costs to move and also purchase another property are quite substantial, which is why being paid the market value of a property is less than the real cost of moving.
In these cases of compulsory acquisition property owners are being saddled by costs they would ordinarily have avoided, so it seems reasonable to expect property owners be compensated for these “relocation” costs.
For example. as conveyancers we see the bank fees plus the stamp duty and Lands Titles Office registration fees when clients buy and sell property.
It is certainly one thing to decide to wear these costs because you have a strong desire to move away from a location or move to a different location or a different type of property, but as the writer says these property owners aren’t moving by choice and it does seem appropriate that authorities take these expenses into account as the true cost of moving against your will.
Maybe at times like these, we can benefit from the simple wisdom of characters like Darryl Kerrigan from The Castle, to put things clearly:
Compulsorily acquired? You know what this means don’t you, they’re acquiring it compulsorily.