NZ Property Investor June 2021
The New Zealand Property investor magazine provides readers with information you can use to successfully invest in residential property. You can learn from the experts, read the stories of your fellow investors and keep up to date with the latest house prices and rental statistics.
in this issue
the apartment revival
Turning back the clocks to mid-2020, we saw Covid-19 and lockdown, rental freezes and experts predicting property price plummets. A year on the market is soaring, with median prices up nationwide by nearly 25% year-on-year (according to REINZ data for April). A year ago, the inner city of Auckland was a wasteland. Foreign students had fled back home, and you could see the tumbleweeds blowing down Queen St. It was a terrible time for investors in this market: within one week, over 1,200 apartments were vacated. Investors dropped their rents, new tenants were securing apartments for under $200 a week, and the future was unsure. But fast forward to 2021, and the market is up and running again. Now tenanted by local university students, and renters who work in the city and…
new homes under threat
Resources are short in the construction sector, putting the quality of new homes at risk. Yet demand for new builds has soared and is soaring again as investors are incentivised to shift away from existing houses. Independent economist Tony Alexander says throw in increasing government and council efforts to get more and more houses built and there is a problem that will crop up somewhere down the track – builders with little experience becoming involved in the sector because there are not enough qualified tradies. “Quality, longevity, reputation, and restraint are going to increasingly count as measures of builder/developer success in the next five years.” Adding to the construction sector’s productivity worries is an ageing population renovating their homes to see them through retirement. “Either people upgrade their houses to make a sale,…
new tax concerns ‘dismissed out of hand’
This came out of a meeting the Property Investors Federation had with Government ministers and officials to discuss the effects of the bright-line test’s extension to 10 years and scrapping the mortgage interest tax deductibility. Federation president Andrew King and federation executive officer Sharon Cullwick went to the meeting armed with research showing 69% of investors will not be affected by the bright-line change, but removing the ability to claim mortgage interest payments as a legitimate tax deduction will affect 90% of landlords by an average cost of $4,542 per rental property. The research also shows more than 70% of landlords want to increase rents by a median of $21-$30 a week to keep their rentals. King says the First Home Buyers Club, Tenants Protection Association (Christchurch) and Renters United in Wellington backed…
cleaning up
The end of tenancies often brings ongoing issues around cleanliness and tidiness to the fore. When Faapouliaolelagi Niko left the Takanini rental she was inhabiting in a state not considered appropriate by property managers Barfoot and Thompson, they took her to the Tenancy Tribunal for compensation. Photographic evidence revealed that the carpet (which was new at the beginning of the tenancy) was covered in stains. The tenant had failed to clean the oven, range hood, switches, laundry tub, and there was mould on the ceiling. They had also left rubbish inside the house. The property managers were required to have professional steam cleaning undertaken on the carpet; an invoice was provided for the steam cleaning undertaken to remove the stains. Additionally, it took three hours of extra labour to clean the rest…
investors to face lower house prices and more policing
The Treasury has predicted annual house price growth will peak at 17.3% in the June quarter this year and take a deep dive to 0.9% by the June quarter next year – about half of the expected inflation rate of 1.7%. After that house price growth is expected to stay at about 2.5% over the next four years. However, it has also warned if house price growth does drop it will dampen economic recovery. Finance Minister Grant Robertson says it is a sharp adjustment in house prices, but a necessary one. New Zealand Property Investors Federation president Andrew King says it is difficult to predict what will happen with house prices as there are so many variables in the market. He says if investors can’t find ways to deal with the increase in…
nz property investor events calendar
PROPERTY APPRENTICE SEMINAR EVENTS Thursday, June 3, 6:30pm-8:30pm; Wednesday, June 9, 6:30pm-8:30pm; Thursday, June 17, 6:30pm-8:30pm; Wednesday, June 30, 2021, 6:30pm-8:30pm; Sat 26 Jun, 2021 1pm-3pm. All online. Greenlane, Saturday, June 26, 2021. See https://www.propertyapprentice.co.nz/free-property-investment-seminars/ PROPERTY INVESTMENT & EDUCATION WEBINAR Available on demand or via Zoom webinar. 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 7-MODULE ONLINE COURSE: Available on demand. Hosted by Gilligan Rowe & Associates. Includes over 12 hours of videos, articles and quizzes. Cost is just $595. For more information and to register: https://www.gra.co.nz/events/gra-property-schoolor phone +64 9 522 7955. Please contact stephanie@propertyinvestor.co.nz for bookings. Deadline for July issue is June 10.…
