Auckland's property market has been infamously red hot, but demand for this snug East Auckland home, with polished wooden floors and deck, has been non-existent.
The owner did not respond to requests for comment but Ray White agent Benjamin Neal said the property had been on the market a year.
"It was at $100,000, then it was at $50,000 and then it was $10,000 and now it's at $500."
A staff member at landlord St Johns Holdings confirmed the property was in its stable. It had a 21-year perpetually renewable lease, due to be renewed in 2029. Renting and sub-letting is allowed, but St Johns Holdings does not allow owners to freehold their properties.
The Ray White ad boasts the new owner won't need to worry about being moved on by a landlord keen to cash in on Auckland's soaring property prices.
But property experts weren't sold. Auckland University senior lecturer in property Dr Michael Rehm, described the St Johns house as a "total loser. To own it costs more than $712 a week, with the rates.
"You could rent a place like that for around $600 a week. So you're in the hole for $112 a week, if it is tenanted constantly."
A positive return may be possible but it would take many years and carried a high risk. He doubted the property would sell. "I think probably the owner will go bankrupt at some stage and just move on."
The ground rent was high because Auckland's property market had "gone ballistic", a situation that has stung other leasehold property owners in Auckland.
A steady stream of homeowners on sections owned by the Cornwall Park Trust abandoned their properties after ground rents skyrocketed in tandem with the city's booming property market.
Auckland Property Investors' Association president Andrew Bruce was not a fan of leasehold properties because land, not the buildings, gained in value. But he knew of investors prepared to try their luck.
Anyone buying leasehold must make sure they understand the contract and its implications completely, he said.
