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

The number of sales in June on the Peninsula was 23 and the median selling price was $953,000. The average days to sell was 30. There were 8 sales over $1,000,000. The highest value sale was 57 Kervil Ave at $2,560,000.

6 Street Spotlight

Average Rent for Te Atatu Peninsula: 1st January – 30th June 2017

Did You Know?
The highest value of sales on the Peninsula in the past 10 years was $37,085,500 (29 sales) which was in June 2016 – last year.

Quote of the month:
Top 10 things to do when selling your home, 1# call John Goodrum, I will handle the other 9.

Until next time,

Best wishes,

John Goodrum
021945140
thelegendofthewest@gmail.com

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

The number of sales of dwellings including apartments in Waitakere City for April was 230. There were 27 sections sold. The median selling price was $760,000. The average days to sell was 35.

Capital Gains April 2012– 2017 Median Prices

Henderson                       94.7%

Te Atatu Peninsula              101.1%

Te Atatu South                 160.2%

The reserve bank once again left the official cash rate (OCR) unchanged at 1.75% on the 11^th of May. Graeme Wheeler, the Reserve Bank Governor, indicated that he did not expect to change the OCR in the foreseeable future (meaning not this year and
possibly not until well into 2018, if then).

The reasons given were low inflation, a lower NZ dollar which helps exporters, strong household spending and slower house price increases, especially in Auckland.

Of concern was political uncertainty (he was referring to world politics but I am sure he has an eye on possible NZ politics with this year’s general election in September).

He expects some house price increases but nothing like we have seen in the past couple of years.

The obvious reasons for this (in Auckland) is the shortage of houses, strong net
migration, a shortage of building trades workers and low interest rates. As far as I can see, none of these factors are likely to change quickly so it is reasonable to expect house prices to increase, all be it at a slower rate than last year because of Reserve Bank’s lending restrictions to borrowers.

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