There were 130 dwellings including apartments and 1 section sold in December in Waitakere City. The median selling price for dwellings was $742,500. The average days to sell was 31.

In January there were 192 dwellings including apartments and 10 sections sold. The median selling price for dwellings was $737,000 and the average days to sell was 42.

Capital Gains December 2012 – 2017 Median Prices 

Kelston 84.1%
Glendene 79.4%
Massey 72.1%

Capital Gains January 2013 – 2018 Median Prices

Ranui 82.5%
Glen Eden 74.8%
West Harbour 66.3%

The government is implementing a change from 2 years to 5 years for the bright line test. This means if a person buys an investment property to rent out and has to sell (eg loses job and can’t afford to keep it), they will have to pay tax on any capital gains.

This will reduce the number of people buying rental properties making the
already big shortage of rental properties worse. Rents will likely increase as the shortage continues to grow. Foreign buyers can now not buy existing New Zealand houses (except Australians).

Foreign buyers can buy new houses but the government now compels them to sell after 12 months. Very few are likely to buy under these restrictions so little help will come from this source to build New Zealand housing stock.
Perhaps we need to have a conversation about that or launch another
enquiry.

Do you want to know the value of your property? Its probably worth more than you think. Contact me for a free no obligation value update.

Best wishes,

John Goodrum

Licensee Agent REAA 2008

021945140

thelegendofthewest@gmail.com

The number of sales of dwellings including apartments in Waitakere City for August was 284. There were 11 sections sold. The median selling price was $762,000. The average days to sell was 37.

Capital Gains August 2012 – 2017 Median Prices

Green Bay            64.3%

New Lynn             86.7%

Royal Heights     109.2%

The number of sales of homes in Waitakere City for August was 284, this was up from last month. Prices also increased by 3.8% over July prices. These figures reflect increased prices and sales numbers across Auckland as a whole. Sellers are not willing it seems to sell below the prices they saw similar properties to theirs sell for a few months ago. There is little doubt that the shortage of houses is getting worse in Auckland as demand is exceeding the rate of building new ones.

On that basis prices would be expected to rise. Factors likely to hinder price rises however are (1) the tight lending requirements from banks mainly  because of the LVR (loan to value ratio) restrictions imposed by the reserve bank. (2) A change of government as a Labour led government would:

A. Restrict immigration which would reduce demand and slow many sectors of the economy such as hospitality and horticulture which are already short of workers and rely heavily on temporary immigrants / seasonal workers.

B. It is clear that there are not enough construction trades workers and immigration restrictions would prevent more houses been built.

C. Capital gains tax rise on any rental house purchase would mean less buyers for rental properties so prices would be inclined to fall. At the same time a sever shortage of rental properties could ensue. This rental shortage would tend to drive up rents but the government could well put restrictions on rent increases.

D. It looks likely that when a deceased estate property is sold it would not then be classed as a family home and so could be subject to capital gains tax. This is what people are calling an inheritance tax. If that became the case a properties market value would be less. Nothing is certain in life and this is especially true of the 2017 general election.

Do you want to know the value of your property? Its probably worth more than you think. Contact me for a free no obligation value update.

Best wishes,

John Goodrum

Licensee Agent REAA 2008

021945140

thelegendofthewest@gmail.com

Welcome to the thirty-third edition of the West Auckland monthly Residential Landlords Newsletter.

I am a landlord myself and have been for over 30 years. I currently own rental properties in South Auckland, the North Shore and of course West Auckland. Being a high preforming Real Estate Agent (top 1% in New Zealand) for over 26 years and always working in West Auckland I know the real estate market and the rental market very well.  

In this and future newsletters I hope to provide ongoing up to date information relevant to landlords who own rental properties in West Auckland.  

Regular features will include: 

• Current sale prices
• Current mortgage rates
• Current rents
• A monthly suburb spotlight review
• A relevant feature article each month

 Source REINZ

Source – J Goodrum – Internet search

 Source NZ Government building & housing 

Source NZ department of statistics 

The Benefits of a Regular Home Inspection

There are very few rental properties in West Auckland with a market value of less than $500,000, that’s half a million dollars! 

Few, if any West Auckland landlords will be driving a car worth $500,000 yet they would consider it foolish not to have their car maintained and serviced on a regular basis, even if it cost 1 / 10^th of the price of their rental property. So why it is that most don’t have a regular professional home maintenance inspection on their much more valuable rental property?  

Beyond cleaning and painting most landlords only fix problems as they arise. At that point the cost to fix could be many times the cost that would have been required to maintain the property before it needed fixing. Let me give you an example. A small rust hole in a roof may mean that water drips into the ceiling over a period of weeks or months until the ceiling falls into the lounge. 

What happened was that the un-noticed water was soaked up by the loft insulation which became heavier and eventually saturated until the gib ceiling became soaked, lost its strength and collapsed into the lounge. The repair cost is now substantial – probably several thousands of dollars. What is now required to repair? 

1. Cleaning up the mess and drying the lounge carpet.
2. Removing the insulation from the loft and paying “tip” fees to dump it.
3. Drying out the loft.
4. Installing a new gib ceiling.
5. Gib stopping and sanding a new ceiling.
6. Gib sealing and painting the new ceiling.
7. Possible light fitting electrical repairs.
8. Installing new loft insulation.
9. Fix the hole in the roof. 

A regular say 5 yearly professional home inspection would pick up such potential problems that could then be maintained at a fraction of the repair cost. The typical cost of a professional home inspection depending on the size of the house would be $400 – $800. That is $80 – $160 per year if done every 5 years. A very good investment that could save thousands, a lot of inconvenience and possible lost rent. For a good home inspector look online at www.nocowboys.co.nz/ and check out the reviews. 

Until next time,
Best wishes,

John Goodrum
Licensee Agent REAA 2008
021945140
thelegendofthewest@gmail.com
09 838 8895

Welcome to the thirty-second edition of the West Auckland monthly Residential Landlords Newsletter.

I am a landlord myself and have been for over 30 years. I currently own rental properties in South Auckland, the North Shore and of course West Auckland. Being a high preforming Real Estate Agent (top 1% in New Zealand) for over 26 years and always working in West Auckland I know the real estate market and the rental market very well.  

In this and future newsletters I hope to provide ongoing up to date information relevant to landlords who own rental properties in West Auckland.  

Regular features will include: 

• Current sale prices
• Current mortgage rates
• Current rents
• A monthly suburb spotlight review
• A relevant feature article each month
  

 Source REINZ

Source – J Goodrum – Internet search

Source NZ Government building & housing

Source NZ department of statistics

 Insurance of Rental Properties

As well as having insurance for the building it is often desirable for a landlord to have landlords insurance. This typically covers such things as loss of rent, intentional or malicious damage, vandalism or theft by a tenant or their guests. It also covers illegal drug use by tenants or their guests causing the need to test for drugs and the cost to decontaminate the property.

Insurance policies do have limits on the amount that will be paid for such events. Typically loss of rent would be 8 weeks (less any rent paid in advance or any bond held). For illegal drug use and decontamination a typical limit would be $30,000. In order to qualify for a claim for many of the above events the landlord must fulfil a number of conditions, such as: 

1. Take care and check references when selecting a tenant.
2. The property must not be empty for longer than 60 days.
3. Have a written legal tenancy agreement.
4. Collect at least 2 weeks bond and register it with tenancy services.
5. Collect at least 2 weeks rent in advance.
6. Keep photographs and a written inspection report at the start of the tenancy.
7. Notify the tenant in writing if the rent becomes 7 days in arrears.
8. Personally deliver a second letter to the tenant when the rent is 14 days in arears.
9. Apply to the tenancy tribunal for a termination order when the rent is 21 days in arears.
10. Inspect the property at the beginning and end of a tenancy.
11. Conduct 3 monthly internal and external inspections on the property and keep written records / photographs. 

Failure to meet the above conditions could invalidate any claim on insurance. For landlords having their properties managed by professional property managers I would strongly suggest emailing them a copy of the insurance conditions and getting a written reply that they will manage your property in such a way that all of these conditions are met. 

For landlords managing their own rentals ensure you follow the conditions of the insurance or do not be surprised if you find your claim rejected. 

Until next time,

Best wishes,

John Goodrum

Licensee Agent REAA 2008
021945140

thelegendofthewest@gmail.com
09 838 8895

Welcome to the thirtieth edition of the West Auckland monthly Residential Landlords Newsletter.

I am a landlord myself and have been for over 30 years. I currently own rental properties in South Auckland, the North Shore and of course West Auckland. Being a high preforming Real Estate Agent (top 1% in New Zealand) for over 26 years and always working in West Auckland I know the real estate market and the rental market very well. 

In this and future newsletters I hope to provide ongoing up to date information relevant to landlords who own rental properties in West Auckland.  

Regular features will include: 

• Current sale prices
• Current mortgage rates
• Current rents
• A monthly suburb spotlight review
• A relevant feature article each month       

Source REINZ

Source – J Goodrum – Internet search

Source NZ Government building & housing 

Source NZ department of statistics 

So what is the future for the rental market in New Zealand? 

I believe it is very bright for landlords. It is expected to continue to grow. Even if the percentage of people renting (33% in 2016) stayed the same, the growth in the number of houses would mean that the number of rental properties will grow. 

It is likely however, that the percentage of people renting will also continue to increase as it has for the past 25 years. The reasons are the shortage of houses in Auckland, which will for some years yet not be eliminated and mean prices will continue to rise, meaning less people will be able to afford to buy.

Rents are likely to increase as house prices increase but rent rises usually lag behind house price rises. Remember also that as house prices rise it is not certain that rents will rise. 

In the UK for example, in London there is a shortage of houses and prices are rising, yet rents are falling slightly. Brexit perhaps? The political scene can have a significant effect. The general election this year could change things dramatically. 

The New Zealand House Rental Market – Past, Present and Future

The peak of home ownership in New Zealand was in 1986, when 76% of New Zealander’s owned their own home. That meant that 24% were renting. The ownership rate declined in the 1990’s and has continued to fall ever since. 

The main reasons for the growing numbers of rentals is the rising prices of houses. In West Auckland, the median house price in 1992 was $112,000. Today it is $760,000. That is a 578.6% increase in 25 years or 23% straight line increase each year. For many over the years, as today, house purchase is not affordable. 

Today in New Zealand, 33% or 1 in every 3 houses in rented. Is that a bad thing? Well, it is not a sign of a poor economy. After all, the New Zealand economy is one of the best performing in the OECD (Organisation for Economic Co-Operation and Development countries) which include much of the European Union, USA, Japan, Korea, Australia and Canada.  

Also, it is interesting to note that one of the poorest performing economies in Europe – Spain, has the highest owner occupancy rates at 83.2% (16.8% rentals) and the best performing European economy is Germany, which has the lowest owner occupancy at 43% meaning 57% of Germans rent their house. 

If you would like to discuss your rental property situation please call me for a confidential discussion. 

Until next time, 

Best wishes, 

John Goodrum

Licensee Agent REAA 2008
021945140
09 838 8895