Monthly Landlord Newsletters

Welcome back to the Propertyscouts monthly landlord newsletter, where we update you on all things New Zealand property market, investor insights, seasonal reminders, and more.

 

The Return of the Granny Flat

Considering ways to maximise your property's yield potential? With new legislation potentially in the works, adding a granny flat might be your answer! The proposed law changes would remove the need for building consents on homes under 60 square meters in certain areas. Announced by the coalition government, this new policy aims to simplify the process of building small backyard flats and increase the supply of housing. Currently under consultation, it’s expected that changes could come into effect from early 2025. Watch this space for updates! 

 

Want the full scoop on pet bonds? New article out now!

In recent newsletters, we've been updating you on the Residential Tenancies Amendment Bill and proposed ‘Pet Bonds’. We've since released a full article covering all the details of what would be involved as part of the updated legislation around renting to pet-owning tenants. 

This covers….

• What pet bonds are, and the extra security they can provide tenants and landlords alike. 

• Tenant benefits: how changes could open up rental options for pet-owners. 

• Landlord benefits & drawbacks: Under new legislation, landlords would have better financial protection when renting to tenants with pets. However their ability to refuse pet-owning tenants would be restricted. 

Make sure to click here for the full article to ensure you’re prepared for potential changes, expected to come into play early 2025. 

 

Recent Property Investor Insights by Tony Alexander

Stay informed with the latest property insights provided by Tony Alexander. Learn about the developments and trends shaping the New Zealand property market currently, covering:

• Landlords are finding it increasingly difficult to secure reliable tenants.

• Landlords are lowering rent expectations for the coming months. 

• Many investors plan to sell more properties than they purchase in the near future.

 

The Latest Ask An Expert from Within the NZ Property Investor Magazine | July 2024

Propertyscouts is the designated Property Management Expert in the popular magazine: NZ Property Investor. Our Managing Director, Ryan Weir, recently entered a response to their recent 'Expert Advice Q&A'. View our May entry below: 

Question: My tenant has given notice to vacate while I'm overseas. Can I wait until I return, about 10 days after they leave, to do the final inspection and deal with the bond refund? Will this breach any laws?

Answer: Under New Zealand's Residential Tenancies Act (RTA), there's no explicit timeframe for completing the final inspection and bond refund after a tenancy ends. However, prompt action is crucial for both parties. Bonds are significant for tenants, often needed for moving costs. It's essential to complete and submit the bond refund form to Tenancy Services swiftly to ensure a timely refund. If disagreements arise, the Tenancy Tribunal can intervene.

Note that if you'll be abroad for over 21 consecutive days, it's a legal requirement under the RTA to appoint an agent in New Zealand. This agent, who doesn't have to be a property manager, must be trusted to fulfill the necessary obligations. Remember to promptly notify the tenant of the agent's details and inform Tenancy Services.

Consider conducting a pre-exit inspection before traveling to address any issues beforehand. This allows your appointed agent to handle the final inspection, including checking cleanliness, and report back to you on any pre-existing or new issues. Your appointed agent can also submit the bond refund form to Tenancy Services on your behalf, ensuring a smooth transition even while you're abroad.

 

July Rental Market and Investment News Roundup

And of course, no newsletter is complete without a quick recap of recent news. Here are some key updates in the New Zealand property investment landscape. 

A marginal price decline to note

Recent Data released by Corelogic suggest that house prices nationwide are on the decline, aside from some exceptions. The national average dwelling value dopped from $934,806 in March to $931,438 in May. Auckland is experiencing the sharpest declines, whilst cities like Christchurch, Hamilton & Dunedin observed slight increases. Across the board, however, we’re still seeing a buyers market with easing property prices and increased supply. 

Further factors affecting this market

It’s worthwhile noting that whilst rental listings are up in recent months, we’re also seeing many kiwi’s heading abroad. This is another factor that could affect rental yields with increased supply in the market. 

Playing the long game

Whilst these changes are marginal, they’re shifts for property managers to be aware of in coming months. 

The downsides: 

• These changes could see a reduced urgency in the market, affecting your ability to sell properties quickly or at desired prices

• Economic uncertainty is affecting our renters, with lower household incomes and increased rental supply potentially affecting rental yields

The upsides: 

• If you’ve got the cash flow, now might be the time to invest with more properties on the market, at lower prices. 

• Whilst we’re noticing a slight market slump, there are plenty of indicators towards a much healthier investor market in the not-so-distant future. This includes recent legislative changes aimed at easing restrictions on investors, and potential dip in interest rates moving into 2025. 

Our strategic take-aways: 

• Manage expectations for coming months: For investors, rental prices have been fairly high in recent months. Whilst you can prepare for a slight dip here, we don’t think property investors need to be too concerned. Demand remains strong enough for us to be confident in ongoing high occupancy rates for our property owners. 

• Remember the long-game: With a variety of legislative and economic factors anticipated to ease pressures on investors moving into the new year - we’re big advocates for the trending slogan ‘survive till ‘25’! Investors focussed on long-term rental income rather than short-term capital gains could capitalise on this moment. 

• Manage your risks: Diversifying your investment portfolio across different markets or property types could mitigate the risks associated with local market downturns.

 

Quick Start Franchise Opportunities

We still have a variety of quick starts available - key areas to note are some amazing opportunities available in Auckland, Tauranga, Palmerston North & Timaru. 

Enquiries are coming in fast, so make sure to chat to Ryan Weir by emailing ryan@propertyscouts.co.nz if you're interested. 

 

Quote to Ponder

"Opportunities don’t happen, you create them." - Chris Grosser

 

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Disclaimer

Given the opinions expressed in parts of the email, it’s important that we make it clear that the contents are opinions and observations and made in good faith.  

Propertyscouts NZ (2020) Limited, trading as Propertyscouts, and its associated parties (including directors, agents, employees, officers or otherwise) have attempted to provide   this information to the best of their ability but do not make any representations or warranties of any nature (intended or implied) as to the accuracy of the information on this communication. All recipients of this communication should conduct and rely on their own enquiries in relation to the information on this communication.

The information available on the properties listed for sale, rent or otherwise, has been obtained from the vendor or landlord of the property and the appropriate professional service providers. We do not and cannot verify or guarantee the accuracy of the information obtained in relation to the properties.

The information and/or materials available in this communication are intended to be general information only and may be changed at any time, without notice to you. The information and/or materials in this communication should not be relied on under any circumstances as a substitute for legal, financial, real estate, or other professional and/or expert advice. To the maximum extent permitted by law, Propertyscouts and its associated parties disclaim all liability, responsibility, and negligence for any direct or indirect loss or damage suffered by any person arising from the information and/or materials presented in this communication or any information and/or materials that arise from it.