Propertyscouts Monthly Landlord Newsletter - March 2025
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.
Important Updates to the Residential Tenancies Act - Effective 20 March 2025
Some key changes to the Residential Tenancies Act will be coming into effect on 20 March 2025:
-
Landlords and tenants can now exchange notices and documents electronically (e.g., email, fax, or messaging) if specified in the tenancy agreement, though a physical address is still required.
-
Smoking indoors can now be banned and enforced through the Tenancy Tribunal. Broader smoking restrictions must still align with tenants’ rights.
-
Email addresses can be used as an address for service for up to two years after the tenancy ends, as long as the email was used during the tenancy.
-
The Tribunal may decide on matters without a hearing if supported by documentation, except in cases involving tenancy terminations or landlord entry rights.
-
Tenants experiencing family violence can now withdraw from a tenancy with just two days’ notice (with evidence), without financial penalty or landlord consent.
These updates aim to streamline processes and clarify communication between landlords and tenants. Make sure you're ready for these changes when they come into effect! For full details, click here.
Property Market Update: Listings Surge & Buyer Interest Rises!
The New Zealand property market is showing signs of life! With a surge in listings and increasing buyer interest, it's clear that the market is in recovery mode.
-
Listings at a 5-Year High! Residential listings on Trade Me Property have soared, reaching 39,000 in January – the highest in five years! This marks a 17% year-on-year increase. More listings mean more choices for buyers – the perfect time to jump into the market! Learn more here
-
Faster Bounce-Back Than Expected! January 2025 saw a 43% month-on-month increase in property views, outpacing the usual January recovery. With a substantial uptick in buyer engagement, the market is gaining momentum. Learn more about the latest trends here.
Investors Testing the Market: A “Pre-Wave” of Activity.
Signs suggest that property investors are slowly returning to the market, with prices rising by 1.3% nationally in the January quarter. Although property values are still lower than last year, the market is showing early signs of recovery, with fewer price drops and a steady increase in sales. Property research firm QV notes that this could be the start of a "pre-wave" of activity, especially in major urban centres where demand is picking up.
Falling mortgage rates, relaxed loan-to-value ratio (LVR) restrictions, and the full return of interest deductibility from April are making rental property purchases more financially attractive. However, first-home buyers continue to play a strong role in the market, particularly in Wellington and Hamilton, where they maintain significant market share
OCR Cut to 3.75%: What It Means for Property and Borrowers
The Reserve Bank has lowered the Official Cash Rate (OCR) by 0.5%, bringing it to 3.75%. This change is expected to stimulate growth and create a gradual recovery in the housing market.
Key Takeaways:
-
Future Rate Cuts: The OCR may drop further to 3-3.25% by mid-2025, which could signal more rate cuts.
-
Mortgage Rates: As banks adjust to the OCR cut, mortgage rates have already started to trend down.
-
Impact on Borrowers: With more stability on the horizon, borrowers may consider longer-term fixed rates in the coming months.
The Bigger Picture: Market Confidence on the Rise
New Zealand's residential real estate market is currently valued at $1.61 trillion, with property listings up 25% compared to the five-year average. Although rental market conditions remain quiet due to slower net migration, gross rental yields have risen to 3.9%, the highest since early 2016. With 71% of existing mortgages set to reprice over the next 12 months, many borrowers will be watching how further OCR cuts affect lending conditions.
Looking ahead, 2025 is expected to bring renewed interest and cautious optimism to the property market.
With more listings, stabilising prices, and falling mortgage rates, both buyers and investors are starting to explore the market again. The big question is how long it will take for the current oversupply to be absorbed, which will ultimately decide how quickly demand starts to push prices higher.
March 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.
-
Muted House Price Growth: House prices are expected to remain stable in the first half of 2025, with minimal growth.
-
First-Home Buyers: The market may continue to favor first-home buyers in the near future, while more investors focus on selling than buying.
-
Migration & Growth Projections: Mid-2025 could bring clearer economic trends, potentially boosting activity.
Quote to Ponder
"The secret of getting ahead is getting started." – Mark Twain
Sign Up to Our Mailing List
Stay tuned for more updates and valuable insights in our future newsletters! If you want to receive these directly to your inbox - sign up to our mailing list here: https://mailchi.mp/a2ede027d1c3/sign-up
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.