A
n investigation into the sales of one of New Zealand's largest property traders has uncovered a lucrative business model. The trader, linked to Hills Real Estate, made an estimated $5.4 million in capital gains from buying and rapidly reselling 71 Auckland homes at an average price of $76,000 per property. The company bought these homes for approximately $54 million and sold them for nearly $60 million over two years.
The practice of "flipping" properties involves trading companies selling the same house to each other multiple times in quick succession. In some cases, this occurred up to nine times within a short period, with transactions sometimes taking place on the same day. Critics argue that this drives up house prices, but Hills Real Estate director Rickhil Prakash disputes this claim, stating that his team risks losses and customers are satisfied.
A house hunter in South Auckland noticed a pattern of homes being listed for sale after they had recently been sold at auction. The trader's business model has raised questions about the impact on the local property market.
