NZ Property Investor

With Cyclone Gabrielle tearing its way through much of the North Island, February was a terribly difficult time in New Zealand. We sincerely hope that no-one has suffered loss of family or friends, and look forward to more settled months ahead. In this issue of New Zealand Property Investor, we investigate opportunities in the current market. Market downturns are usually great for savvy investors, but the downturn we are currently experiencing is different from many that have gone before. Sure, there may have been a decrease in median house prices nationally of around 13 per cent year on year (according to REINZ January data) but considering house prices rose 45 per cent in the 18 months between May 2020 and November 2021, this is nominal. Interest rates are high, credit…

UP FRONT NEWS Research by Colliers International on residential and commercial property market sales activity immediately before and after the past seven elections highlights they rarely disrupt the property market from existing trends, unless there are significant government property-related policies in the limelight. Given the current differing policies and views between the major parties, and the recent resignation of the prime minister creating policy uncertainty, there is potential for this year's October election to have a rare influence on property market sales activity, but mostly in the residential sector. In six of the seven election campaigns since 2000, there has been little influence on sales activity. However, the one exception was the 2014 election, when Labour promoted a capital gains tax (CGT) and restrictions on the ability of foreigners to…

LEARN ABOUT THE MARKET AND TALK TO OUR EXPERTS BY SIGNING UP FOR OUR MONTHLY WEBINARS: WWW.THESTAYHUB.CO.NZ/WEBINARS Are you interested in learning about the short-term rental market? The Stay Hub webinars cover everything from increasing your rental returns to which properties you should be investing in to suit guest demand. PROPERTY INVESTMENT & EDUCATION WEBINAR, AVAILABLE ON DEMAND. HOSTED BY GILLIGAN ROWE & ASSOCIATES. Free to attend. For more information and to register, please visit https://www.gra.co.nz/events/property-investment-seminars or phone +64 9 522 7955. PROPERTY SCHOOL SEVEN-MODULE ONLINE COURSE, AVAILABLE ON DEMAND. HOSTED BY GILLIGAN ROWE & ASSOCIATES. Includes over 12 hours of videos, articles and quizzes. Special price of $495 for Property Investor Magazine readers (usually $595). To register for the discounted price: www.gra.co.nz/ps-offer or phone +64 9 522 7955. For…

New Zealand now has more property managers than it has drivers, cooks or architects, census data shows. More than 40 per cent of tenancies are overseen by property managers on behalf of landlords and in the past year alone property managers lodged more than $162 million in bonds. Common wisdom has it that renters pay more if they rent from a property manager, but is this true? A Consumer NZ investigation set out to answer the question by asking the Housing and Urban Development (HUD) Ministry to compare the value of bonds lodged by property managers with those lodged by private landlords. This approach isn't perfect; there's no single source of truth for who owns what property and how much they rent it for. The best data is from bonds…

UP FRONT NEWS More than 74 per cent of landlords are planning to increase rents this year by at least 5 per cent and possibly more. But this year it will pay for landlords to keep communication open with their tenants over rent rises, particularly as unemployment is expected to jump as the Reserve Bank intends engineering a recession. While most landlords want their properties tenanted at market rent, this is sometimes regarded as excessive. One landlord found himself in hot water with the Tenancy Tribunal for trying to get a 30 per cent rent increase to bring his property up to what he regarded as market rent. The 30 per cent hike foisted on an Amberley, North Canterbury tenant was slashed by the Tenancy Tribunal. In an unusual move,…

TAX UPDATE Whether you are a businessperson signing contracts, a property investor signing agreements with banks, a property trader, or a developer, you will want to pay as little tax as legally required and protect the assets you've worked so hard to attain. So how do you do this? Should you set up a company? A trust? Both? Neither? The answer is in the asset planning process, and the objectives are threefold: Without a good asset plan, your assets could unnecessarily land in creditors’ hands, the beneficiaries of your estate might not get what you intend to leave them, and you could pay too much tax (or not enough and get into trouble with IRD). If your trust succession arrangements are incorrectly set up, your children could lose control of…