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.

Hello, 2025! What’s Happening in the NZ Property Market?

We’re kicking off the new year with some important updates to the Residential Tenancies Act (RTA).

Key changes that came into effect on 30 January 2025:

• The return of the 90-Day No-Cause Termination, applying to both new and existing tenancies.

• The return of 42 Day notices: In certain situations - such as when a property is sold with vacant possession - landlords can end periodic tenancies with at least 42 days' notice.

• Retaliatory Termination Clarification: Tenants can challenge terminations they believe were issued in retaliation for exercising their rights.

Looking ahead, more changes are on the horizon, so it’s a good time to familiarise yourself with what’s coming next. Keeping up with these updates is crucial to staying compliant and avoiding unnecessary headaches. Read the summary of changes here 

As for the property market, predictions point to a steady year ahead:

• Property values are forecast to rise by a modest 5 - 7%, signaling gradual growth.

• Lower interest rates are driving more sales activity, while affordability challenges are keeping growth balanced.

• Buyers currently hold the power, thanks to a high number of listings.

It’s shaping up to be a year of slow and steady progress - both for the market and for navigating these important RTA changes.

Mortgage Market Update: Trends and Insights for 2025

The mortgage market is undergoing some noticeable shifts, with borrowers reassessing their strategies. Lending activity has been on the rise, with a notable increase of $1.3 billion from September to November, compared to the previous months. What’s catching attention is the growing preference for short-term fixes and floating rates. Only 10% of new loans are being fixed for longer than 12 months, a sharp drop from 51% just a year ago. On the flip side, the share of floating rate loans has jumped significantly from 17% to 28% over the past year.

Loan sizes are still substantial, with investors averaging around $549,000 and first-home buyers taking out loans averaging $564,000. It’s also worth noting that banks seem less concerned about defaults, as bad debt provisions have decreased from $977 million to $870 million.

When it comes to high LVR loans, these remain limited, but first-home buyers continue to dominate the space, accounting for 75-80% of such loans.

The big question: When should borrowers lock in longer-term fixed rates? For now, flexibility rules the day, but the window for lower long-term rates may not last.

Read full article here 

 

Recent Property Investor Insights by Tony Alexander

Stay informed with the latest property insights provided by Tony Alexander, offering a cautious outlook on interest rates and mortgage trends:

• A modest economic recovery is expected, with slight interest rate declines on the horizon.

• Business pricing pressures are on the rise, with 43% of businesses planning to increase prices in the year ahead, up from 35% in June.

• The Reserve Bank may reduce the cash rate on February 19, but the cut could be as small as 0.25%, influenced by international developments.

• Strong job market conditions in the U.S. are tempering expectations for major monetary policy changes, which could impact New Zealand's approach.

• Fixed mortgage rates for terms of two years and beyond may not see significant drops from current levels.

 

The Latest Ask An Expert from Within the NZ Property Investor Magazine | February 2025

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 February entry below: 

Question:
I’m a self-managing landlord, and my tenants have raised concerns about the height of the second-story balcony railings, which are 800mm high. The current Building Code requires 1000mm, but the house was built in the 90s. I’m not sure if it complies with the regulations at the time of construction. How should I handle this to ensure the property is safe and meets legal requirements?

Answer:
Since the house was built in the 90s, it’s important to determine if it was constructed before or after the 1992 Building Code change, which increased the required railing height to 1000mm. Railings built prior to this could still comply with the older standard of 800mm. You can confirm the construction date by contacting your local council or obtaining the property’s file.

Regardless of compliance with past regulations, as a landlord, you have a duty under the Health and Safety at Work Act (HSWA) to ensure the safety of your tenants. If the 800mm railing poses a risk, it’s advisable to upgrade it to meet modern safety standards.

If you assess the railing as safe but your tenants are still concerned, you can encourage them to formally request a minor change. This will allow you to consider their concerns within a structured process. However, prioritising safety and potentially upgrading the railing may avoid future issues and give everyone peace of mind.

 

February 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. 

First up, recent data from Tenancy Services shows a stabilisation in residential rents across New Zealand, with most areas settling just below their peak levels. While rents aren’t skyrocketing anymore, the market is finding its balance. 

For those with one-year fixed rates coming to an end in February, you could be in line for the most significant interest rate drops of this cycle, which should bring some relief.

Falling rates are also expected to have a positive ripple effect, boosting household confidence and potentially encouraging more spending.

On the legislative front, the Residential Tenancies Amendment Bill is now law. It’s a win for both landlords and tenants, introducing key changes like the return of the 90-day ‘no cause’ termination for periodic tenancies and updated notice periods for more flexibility. Read full article here

Finally, mortgage rates are predicted to drop below 5% in 2025, thanks to OCR cuts by the Reserve Bank. This is expected to spark more buyer activity and give borrowers some much-needed relief. It’s shaping up to be an interesting year ahead for the property market! Read full article here 

 

Investor Hotpot: Christchurch.

Looking for a property investment that’s set for growth? Christchurch should definitely be on your radar.

There are some major developments shaping up that make this city a standout investment opportunity:

• Te Kaha Stadium: This major project, set for completion in 2026, will open up new opportunities, especially in hospitality and tourism.

• Parakiore Recreation Centre: Due to open in 2025, this will be New Zealand’s largest indoor recreation centre, bringing in more visitors and boosting the local economy.

• Te Pae Convention Centre: Already up and running, Te Pae is putting Christchurch on the map as a business and event hub.

But that’s not all. Nearby districts like Selwyn (set to grow by 47%) and Waimakariri (with a projected 25% growth) are seeing population booms, which means more demand for housing.

One of the biggest perks? Christchurch properties are more affordable than in many other parts of the country, meaning you can secure valuable assets without the hefty price tags you’ll find in other major cities.

If you're thinking about investing in the area, reach out to ryan@propertyscouts.co.nz for more information. 

Read more about Christchruch here

 

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, Christchurch, Rolleston & 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

"Success is not final, failure is not fatal: It is the courage to continue that counts." - Winston Churchill

 

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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.