The new millennium holiday-home dream that excited the developers and drew a fresh wave of punters continues to act as an economic noose for thousands of New Zealanders.
Values in some areas, especially the bigger seaside towns with a reasonable permanent population, have started to recover over the past year or so. But prices are still drifting in many other coastal parts of the upper North Island - often smaller settlements well away from the cities.
Depressingly for many people captured by a herd instinct that pushed prices high in the 2004-2007 coastal property boom, some places will head lower still as a surplus of sections weighs on values.
In Auckland, a growing city, a lack of new building and land and low mortgage rates have created a sellers' market where demand is comfortably out-stripping supply, leading to steady price rises.
At the beach (and lake and river, for that matter), with the odd exception, it is the opposite: too many properties for sale, a huge surplus of land and meagre demand in an uncertain economy where people are careful with their discretionary dollars.
Toss into the equation the reticence of banks to loan on secondary properties without strong buyer equity and the overall result is stark: few sales at the seaside and generally drifting or static prices.
But there are bright spots, and Whangamata is becoming a beacon with rising demand. But even there, prices remain a full 10 per cent below the market highs.
Elsewhere, the prices of 2006 and 2007 are pie-in-the-sky for many bach and section owners. Even if they did manage to get back to those levels today, the damage in real terms would be considerable.
In the towns and cities, stagnant house prices aren't such a problem because they provide an economic return as values inch upwards. They are the roof over family heads - the rent that otherwise would be paid. While urban capital gain has been found wanting outside Auckland since the boom peaks, low mortgage rates and own-your-own security have provided a plausible business case.
But it's a different story at the seaside. Beyond inherited baches which have been in the family for years, holiday homes are bought and sustained by discretionary dollars, like the caravan, a fancy car or overseas travel. They generally sit unoccupied for much of the year, can be a big financial drain and, when capital gain is missing, give nothing back except for pleasure.
It is now a full five years since the dizzy heights of the coastal property boom and some bach and section owners have been trying without success to sell right through that period.
While their "investment" has gone backwards they are, at least today, able to make the decision whether to take a hit or ride things out, with a summer ahead of them to enjoy. The less fortunate had the decision made for them by the banks. Meanwhile, people who walked away with burnt pockets three or four years ago will have few regrets.
While some coastal retreats have slowly come back, hundreds of millions of dollars have been sliced from the value of over-hyped seaside properties in the past five or six years. In the more depressed areas, values have been pushed back to the levels of 2002 or 2003 and, even at those supposedly "cheap" prices, buyers are staying clear.
The reality is that many of those properties and sections went far beyond rational value in a coastal stampede fuelled by easy money and secure economy. Now the bach will not really start to move again until a secure economic recovery encourages decent demand - and, with the world still shaky and confidence low, that is no short-term prospect.
In real terms, how can prices ever return to the highs? All that is holding them up in many places are dogged owners still refusing to accept their places are not worth the money they want or need.
While owning a beach bach is in the Kiwi genes, the explosion of websites giving easy access to properties for holiday rent may also impact on future demand. With capital gain so uncertain and holding expenses so high, paying holiday rent and choosing between a pool of baches in different places could, in the future, have greater appeal than the commitment demanded by being a property owner.
And about those Kiwi genes... our gene pool is changing. Will the bach hold the same appeal for the people of tomorrow who were raised in different cultures?
Then, to potentially dampen demand further, there's the near certainty of a capital gains tax on secondary homes when Labour next forms a government.
Heading towards 2013, the outlook is certainly not glum everywhere. General levels of interest, driven by low mortgage rates, are higher than a year ago and more sales are being recorded. Besides, a slide in prices is of little concern to the thousands of New Zealanders who have enjoyed family baches for years and have no intention of selling.
Sought-after beach spots such as Omaha, which held up reasonably well through the downturn, and Whangamata, which slipped and then slowly turned, have probably fared the best, and small, tightly held settlements such as Whangapoua are also solid.
But no seaside holiday destination is anywhere near being back to where they were - unlike residential property generally across the country which, thanks to the weighting given by powerful Auckland and the special conditions in Christchurch, has now regained the losses since 2007.
Outside the strength of the economy, the biggest problem for many areas is a surfeit of bare land looking for a new owner, impacting directly on house prices.
The Far North, flooded with sections which can find no buyer, is struggling more than most because it is so far from Auckland where future demand will rest.
Douglas Wealleans of First National Mangonui thinks prices are now back at 2002-2004 levels and it may be another four or five years before they begin to move.
"I would like to be more positive, but I'm afraid that parts of the Far North are disaster areas at the moment," he says.
The surplus of sections hangs over the whole region, and that has filtered through to standard residential properties in the past four or five years. The demand for sections is negligible and selling prices can be as low as 30 to 50 per cent of the 2010 rating valuations - which were themselves sliced by around 25 per cent from three years earlier.
An auction in September for eight sections at Coopers Beach and Tokerau Beach was under the control of the Crown and the proceeds-of-crime rules. The sniff of a bargain was expected to bring plenty of interest, but there were few bidders for blocks of land with outstanding sea views covering up to 8000sq m -12 times bigger than a good-sized city section.
In the end, two sold under the hammer and another a few days later; the rest are still looking for a buyer. Back in 2004 or 2005, they might have gone for $250,000. Perhaps more. The 2012 hammer fell between $100,000 and $119,000 - down by $40,000 to $60,000 on the 2010 scaled-down rating values.
Wealleans sold a 700sq m-plus section near the Carrington Golf Course at Whatuwhiwhi a couple of months ago. The original owner paid $130,000 for the land when things were better and must have swallowed deeply in 2010 when he was confronted with a new CV of $90,000.
Sadly, he died and the beneficiaries of his estate decided the $1700 a year rates bill was too much to endure.
Wealleans: "In the end they just wanted to get shot of it. So the price was dropped, and dropped and dropped - until they got an offer around $40,000, and took it."
He worries about declining values for existing homes bought in rosier times as section prices continue to fall, and points to a brand new brick family home in Coopers Beach, which is now for sale at $310,000.
"That package is available at 2012 land prices and would be a great little buy. But when you could get that for perhaps $300,000, why would you consider spending the same sort of money for an old bach?"
Wealleans says tight covenants on some developments have contributed to land price drops. Those convenants don't allow "mum and dad and the kids" to stick up a utility shed, tank and caravan and use the section for holidays and the subsequent lack of demand further weighs on prices.
Then there's the rising cost of petrol which, when added to continued worries over jobs and the economy, has taken the shine off the Far North for Aucklanders with the discretionary dollars to consider a seaside property.
Around the Bay of Islands, Bayleys' Chester Rendell has come out of a winter "where you wonder why on earth you ever got into real estate" to enjoy a more encouraging spring. His agents are taking plenty of inquiries and a few sales point to more promising times. But he doesn't want to read too much into it; it could be just a seasonal thing that will peter out. Overall, it's still "pretty sluggish".
Rendell says the first question he poses to vendors is not why they are selling but "what do you want to do next?"
If the response is along the lines of "nothing in particular" and "we're not going to give it away", he knows the motivation isn't really there and there may be a reluctance to meet the market.
But he's finding property owners are much more realistic now than they were "in the heady days" and are generally now prepared to accept they must lower their sights to get a sale, especially in the upper levels.
"Okay, so we have some properties that five or six years ago might have gone for $3.5 million, and now we're looking at under $2 million," he says. "But those sort of places might have been bought for a few thousand 30 years ago, and rather than worrying about dropping a million or two over five years, it makes better sense to get on with your life and think about the million or two you're ahead over 30 years."
While "upper Northland" has its issues, there are plenty of other areas over-burdened with sections - sitting, waiting and wondering when things will start to turn.
Spitting distance of the cities will help to underpin values over the long haul but, just as a lack of land and high demand are pushing up sales in Auckland, a surplus of sections and minimal demand is an issue wherever they are.
Research by economist Rodney Dickens shows there are plenty of coastal areas - most of them in Northland - with more sections for sale than houses, suggesting they are vulnerable to further price drops.
Top of the list is One Tree Pt-Marsden Pt-Ruakaka where, in mid-October, 203 sections were advertised for sale against 76 houses, giving a section-to-dwellings ratio of 267 per cent. A developer is now trying to sell 50ha of land at One Tree Pt carrying plans for a 411-section sub-division - so the issue there of excess land weighing on prices will be around for a long time.
Others with high present ratios are Coopers Beach-Cable Bay-Taipa (208 per cent), Mangawhai and Mangawhai Heads (192 per cent), Waipu and Waipu Cove (187 per cent), Karikari Peninsula (177 per cent), Matarangi (146 per cent), Langs Beach (114 per cent), Mangonui (110 per cent), Kerikeri (109 per cent), Ahipara (90 per cent) and Waihi Beach-Athenree (76 per cent).
Dickens, a specialist in coastal property trends through his Strategic Risk Analysis company, says: "Section prices in the oversupplied markets are generally grinding lower as the large numbers of would-be vendors gradually realise that asking prices have to be cut to achieve sales.
"Once section prices have fallen to the level that buying a section and building looks more attractive than buying an existing property it will impact more on dwelling prices."
QV's latest data suggests One Tree Pt/Marsden Pt/ Ruakaka is down around 18 per cent on their highs of April 2007 and with so many sections for sale and plenty ready to be developed it is difficult to see any medium-term price impetus. Sections are struggling to sell at half the values of five and six years ago, and the flow on to house prices continues to eat away at personal wealth.
Mangawhai Heads is in a similar category, with many more sections for sale than houses, and buyers looking only for bargains. The pressure from the surplus of sections offered at half the market peaks still weighs on house prices that continue to drift.
Towns close to the cities with limited sub-divisions and a householder mix of permanent residents and holiday casuals are in the best position.
Whangamata is the best example - with Whitianga a little further back - and new rating capital values are expected to show little change since the last adjustment in mid-2009, suggesting both towns have clawed back lost value over the past couple of years. That still puts them 10-15 per cent below the highs, but they have stopped the slide and are now moving slowly in the right direction.
Murray Cleland, principal of Whangamata Real Estate, says his company has left behind an awful winter to find a spring full of interest - even at the upper end, with beachfront sales of $3.6 million, $2.85 million and $2.4 million. A competitor sold a beachfront section for $2 million.
Two years ago, Property Report noted there was no interest in Whangamata properties priced above $700,000 and very little even at entry-level, so something is plainly in the air.
Cleland says 80 per cent of today's inquiries relate to beach houses and properties in the $330,000-$430,000 range are being snapped up. He puts the heightened demand down to the low interest rates and realistic vendors prepared to accept prices around 10-12 per cent on average below 2007 levels.
But down the bay from Whangamata at Pukehina (where values today are nearly 30 per cent off their peaks), up the road at Pauanui and over the hills at Matarangi, the picture is not so encouraging.
Matarangi is very slow, though Pauanui is not as deathly quiet as this time last year. There have been a few more sales, and prices may have clawed their way back a little in a town where four out of five properties are holiday homes.
But here it's still a buyers' market, with more than 150 homes publicly for sale; some have sat for four or five years, drawing no interest. On top of that, many other Pauanui property-owners would probably be happy to get out at the "right" price and are biding their time waiting for a recovery.
Neil Christie, who manages Richardson Real Estate, says entry level in the town back in the boom days was "up towards $500,000". Today it is $100,000 less and some properties have sold at the mid-$300,000 level as vendors reluctantly accept 2012 prices.
When things are so fragile, even the well-heeled put away their cheque books, and sales in the upper bracket have been rare. More than 30 million-dollar-plus homes are on the market, and canal sections which would have been appealing at $800,000 to $900,000 six years ago will struggle today to find interest at $500,000 to $600,000. It is difficult to see any early change in momentum at Pauanui.
While the vulnerable and those wanting to get on with their lives have already cut and run, thousands of people across the upper North Island are holding on to their conviction that coastal property will again have its day in the sun.
No doubt it will, though that's hard to see in real terms. A more certain world - resurgent China, stable Europe and confident, growing United States - may be needed before we turn the corner.
In the meantime the seaside gene in our DNA may have been diluted a little, too. We now know the sparkle in the sand through the coastal boom was not just the sun shining on harmless grains. There was broken glass in there, too.By Bruce Morris