NZ Property Investor

the power of re-thinking

It didn’t take long. The new year had barely kicked off when so too did those regular predictions of property market doom.There was the decline of Auckland property sales, the much greater decline of Sydney and Melbourne prices, and speculation on whether it all meant a crash was looming. On the opposite side of the spectrum, there were problems with KiwiBuild and the unaffordability of various New Zealand housing markets as illustrated by Demographia’s latest rankings.You’d be forgiven for thinking that a property market apocalypse, in some form or another, is coming. But, perhaps needless to say, the reality is somewhat different.There can be little doubt that the halcyon days of our property market’s recent past are over, but it’s not all doom and gloom. Growth may be…

interest -only boost looming

The Australian Prudential Regulation Authority recently confirmed it is ending its requirement that banks limit interest-only lending to 30% of overall mortgage lending.In place since 2017, the limits led to a sharp drop in interest-only lending in Australia and New Zealand, where the major banks are Australian-owned.New Zealand interest-only lending volumes reached $1.6 billion in October, compared to $1.89 billion in October 2016.Mortgage advisers say the APRA curbs have made it more difficult to obtain interest-only lending facilities for property investors.They also say lenders have forced clients through principal and interest (P&I) repayment calculations, affecting their overall ability to borrow on interest-only terms.But advisers hope the Australian changes will see our big banks become more receptive to interest-only lending.The Advice Group’s Stephen Wilton says the development is “really good…

rolling out ready2rent

Run by the Hawke’s Bay DHB, MBIE, the Salvation Army and the Hawke’s Bay Property Investors’ Association, the programme aims to prepare inexperienced tenants for the rental market.While it has long earned plaudits from landlord groups, late last year it was awarded a “highly commended” in the Hawke’s Bay Health Awards.Now groups in other regions are running pilots of the programme with a view to implementing it.NZ Property Investors’ Federation president Sharon Cullwick, who is involved with the programme, says it is wonderful to see the programme being taken up in other parts of the country.“The goal would be to, ultimately, run courses like this throughout the country but we really need a government department to take over this and send out a consistent balanced message.”Ready2Rent has been piloted…

no subfloor insulation requirement

The Government’s much-heralded standards will set minimum requirements for heating, insulation, ventilation, moisture and drainage, and draught stopping in rental properties to make them warmer and drier. But Stop the War on Tenancies spokesman Mike Butler says a requirement to install subfloor insulation should go and that rental property owners who have installed it under threat should be compensated. Under existing law, rental property owners are required to install both ceiling and underfloor insulation by July 1 or face a penalty of $4,000 payable to any person who reports non-compliance.The cost of installing R 1.3 subfloor insulation as required by the Residential Tenancies (Smoke Alarms and Insulation) Regulations 2016 for most of the North Island was $881.64 for a 77 square metre dwelling.Butler says the requirement for subfloor insulation…

post-gluckman meth precedent

Back in May last year Sir Peter Gluckman, then Prime Minister’s Chief Science Adviser, released his game-changing report on meth contamination in residential properties. It suggested that a level of 15 micrograms per 100cm should be the “trigger” for de-contamination rather than the current standard of 1.5mcg per 100cm .Tenancy Tribunal chief adjudicator Melissa Poole subsequently confirmed the Tribunal would be applying the 15mcg level in its decisions - as long as the meth test in a dispute was done after the report was released.Since then, the Tribunal has handed down a number of decisions on the issue of landlord decontamination claims. However, the one which is considered authoritative is Crichton v Bay City Rentals Tauranga [2018].In Crichton v Bay City Rentals Tauranga, the situation was complicated by the fact…

uncertainty flavours market

Property news kicked off the new year in a bleak fashion. Not only were there more breathless reports of tumbling house prices in Australia, but the first local data off the block announced that Auckland was looking at its first price decline in a decade.Since then, all of December’s data has been released and the tale it tells is one of Auckland’s much quieter market which does include slight price declines. It also reveals the national market continues to slow, although various regional markets are still playing catch-up. But commentators don’t believe that Auckland, or New Zealand, is facing a crash, or a dramatic correction. That’s because those niggling high demand, low supply drivers remain at play. Rather they think the market will be determined by uncertainty and that…