There were 240 dwellings including apartments and 15 sections sold in Waitakere City in October. The median selling price was $780,000. The average days to sell was 34.

Capital Gains October 2012 – 2017 Median Prices 

Hobsonville          56.8%

Henderson           79.0%

Te Atatu South    53.5%

The latest reserve bank announcement on the 28th of September left the official cash rate (OCR) unchanged at 1.75%. Little has changed to the economy and the OCR is not expected to change this year and perhaps not in the first half of 2018. Following the election of a coalition government of the 2nd and 3rd parties in the general election, there is likely to be significant changes to the property market.

Signalled are cuts to immigration, overseas buyers not allowed to buy a house, extensions of the bright line test from 3 years to 5 years (buy and sell in less than 5 years and you will be required to pay capital gains tax). More restrictions on landlords and a warrant of fitness for rental property are just some of the impending changes. Since the announcement of the coalition government the New Zealand dollar has fallen which will make purchase of all imported good more expensive -  including building components.

The real estate industry and others have been lobbing for the LVR (loan to value ratio) restrictions to be eased especially for first home buyers but so far there is little indication that the reserve bank will listen. Adding to the mix is that the government wants to build an extra 10,000 houses a year (highly unlikely) due to the shortage of building tradespeople. We still have a shortage of about 40,000 houses in Auckland so taken together with all the above factors it is very difficult to predict what will happen with prices.

If I had to make a forecast -  no change this year and small increases next year. 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-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

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

The number of sales of dwellings including apartments in Waitakere City for May was 280. There were 13 sections sold. The median selling price was $755,000 and the average days to sell was 37.

Capital Gains May 2012 – 2017 Median Prices 

Glendene           119.1%

Kelston               126.3%

Massey               111.1%

On the 11th of May the reserve bank announced an unchanged official cash rate (OCR) of 1.75% meaning there has been no change this year. The indications are that there will be no change this year and possibly even no change in 2018.

Having said that the trading banks have been increasing both floating and fixed term mortgage rates making the cost of financing mortgages higher. In Auckland house prices fell by 0.7% in May and West Auckland was the same with a fall of 0.7%.

The number of property sales in Waitakere City was up from April by around 17%. The shortage of houses is getting worse not better and I feel this slight fall in prices last month will not be the sign of ongoing price falls.

Simple supply—demand dictates prices will in fact rise as the shortage of houses grows at the same time as demand is growing as the population of Auckland
increases. We don’t however have a free market where supply and demand issues alone determine prices.

The Loan to Value Ratio (LVR), central bank restrictions and other controls on the lending banks mean it is harder to obtain mortgages. Expect to see sluggish market sales until after the general election now in September.

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