Innholdsfortegnelse for December 2023 i NZ Property Investor

It's the festive season and we hope you are all excited about the coming celebrations. As you have probably realised, it's also our 20th birthday. Significant milestones such as this are a time for reflection and contemplation; the opportunity to look back and consider how far we've come. And New Zealand Property Investor has come a very long way. Since its inception in the early 2000s, the magazine has gone from strength to strength. We've kept up with the times; our content constantly evolving to reflect the changing world of property and publishing. Our new website (www.propertyinvestor.co.nz) reflects this commitment to change. Updated regularly with news and insights, and monthly content from the most recent magazine, it's the perfect place for readers to find everything they need to know around…

YOUR ACCOUNTANT In New Zealand, where our economy is dominated by farming, succession planning for the family farm is a big issue and one that is never straight forward to plan or navigate, especially for large families. Farms are right at the top of the list of legacy assets that families are generally passionate about holding onto intergenerationally. Baches are probably second. But have you stopped to consider what your succession plan is for your property portfolio? At its most fundamental, the question is really whether it's fair or appropriate to leave your family with the actual property assets or is it better to leave them with liquid investments like cash or shares that are readily divisible. There is no right or wrong answer here, but there are many tentacles…

YOUR REVIEW Anita and Tim's first foray into property investment saw them buy three at once, but they almost didn't take the plunge because they were getting conflicting advice from their financial adviser … and Opes. Here's how Anita and Tim, of Wellington, used property to secure their financial independence. WHAT GOT THEM STARTED? Anita and Tim had spent 14 years pouring all their spare cash back into their business. And it worked. Tim was running a successful business while Anita was at home with their young kids. It was a luxury they had worked so hard for, and now it was paying off. At the same time, they found themselves with spare cash, and they had been looking to diversify their investments for some time. Managed funds were one…

THE DATA Rental data is sourced from the Ministry of Business, Innovation and Employment based on rental bonds lodged. This data is supplied grouped into geographic areas based on statistical area units used by Statistics NZ for the census and as a result do not always match well with common usage suburb names. The rental data for each area is matched to property price information from our database to determine property prices and therefore yield. The yield is calculated as the annualised rental income divided by the median property value calculated using our E-Valuer. MARKET COMPOSITION The rental market across Rotorua is dominated by houses, which is normal for most parts of the country. Of the 309 properties recently available on the market for rent, 243 have been houses (79…

1. HEALTHY HOME: Homes rented through property managers are required to have a certificate saying they are compliant, but The Rental Bureau's managing director, Victoria Heyes, says there is a misunderstanding of what a healthy home is. An example was after Auckland's January floods when tenants assumed if they had wet carpets the house wouldn't pass the Healthy Homes standards. Ironically, a home with a wet carpet still passes the standards. While most people wouldn't consider it still a healthy home, if it has a heat pump, ventilation and ticks all the boxes, it passes the test. Because of this, property managers say there is a level of misunderstanding. Tenants believe it is unhealthy if it has a wet carpet and mould on the ceiling, and it doesn't matter if…

HOUSE PRICES: STEADY At $$795,000, the national median house price is virtually the same as last month and for much of this year. The latest REINZ data show a slight decline nationally of 2.8 per cent, while New Zealand, excluding Auckland, is down by 4.7 per cent to $691,000 from $725,000. Median sales prices year-on-year increased for several regions, with Tasman (+2.0 per cent), West Coast (+2.6 per cent), Canterbury (+3.2 per cent), and Southland (+2.4 per cent). There has been a drop in median sales prices across all other regions year-on-year this month. OCR: STEADY The Reserve Bank's official cash rate has been held at 5.5 per cent since July after the RBNZ indicated it was at the end of its tightening cycle, although a couple of bank economists…

FEATURE 20-YEAR ANNIVERSARY It started as a pamphlet in the late '90s, produced by volunteers. In 2003, New Zealand Property Investor became a fully-fledged, glossy newsstand magazine. Now, in 2023, the magazine is celebrating two decades as the voice of New Zealand property investors. The magazine was launched by the highly experienced investor (and founder of GO Property Rentals) Daryl Fisher. He was president of the New Zealand Property Investors' Federation (NZPIF) at the time and the magazine was initially a labour of love, created in-house by volunteers. Early copies of the magazine were DIY affairs, but they served their purpose as a vehicle for news and views. But by the early 2000s, the federation started considering how to turn the magazine into a more serious affair. “We had a…

DIY PROJECT CALEB AND ALICE PEARSON At some point of owning a property you will undoubtedly need to refresh the walls. Just living in a home creates wear and tear, and this gathers cumulatively over time until you come to a point where you realise some TLC is needed. The common thought for most of us would be to do an internal repaint in this situation. And, yes, a repaint is by far the most popular choice. But before you jump in, is it time to consider using wallpaper? I've seen, and been involved with creating, some bold and colourful house makeovers. As part of this we have regularly used both options for several reasons. Before you start your next makeover, here is food for thought on the differences between…

YOUR SHORT-TERM RENTAL During your property's initial setup consider investing in quality lockboxes or digital locks. For standalone properties, smart locks or digital door locks offer the best protection. While they tend to be more expensive, the long-term investment is worth the price and hosts will not need to leave their keys unattended. With smart locks, keyless access can be managed remotely and a digital record of each entry will be logged. Thorough encryption protocols make it extremely difficult for smart locks to be hacked and most can seamlessly integrate with smart security home systems. Basic digital locks with keypads are a viable alternative and codes can be changed between each stay. If your property is located in an apartment complex, your guests will likely need keys and a building…

NZPIF FROM THE PRESIDENT'S DESK SUE HARRISON The world of property investment is a dynamic landscape, influenced by shifting markets, emerging technologies, evolving regulations, changing societal needs … and politics. In this environment of transformation it's important for us to unite, share knowledge, and collaborate to navigate the complexities and seize the opportunities that lie ahead. When I became an “accidental” president just under 12 months ago there were many questions I asked myself. The biggest one is the one we all share. While money may seem like a driving force in our investing journey, there are more noble motivations at play. Are we making our world a better place in our pursuit of a better lifestyle for ourselves and our families? I challenge you to ask yourself as a…

One of the highlights of any NZPIF Conference is the gala dinner during which awards are presented. It's wonderful to publicly acknowledge the immense effort owners of rental properties put into making their homes a welcoming place for tenants; and every year a member of the NZPIF is acknowledged as the best of the best. This year's gala dinner was notable for something else – the public celebration of the 20th anniversary of New Zealand Property Investor magazine. As editor, I had the privilege of sharing a little about the magazine and cutting the delicious cake made by chefs at Rydges Hotel, where the conference was held. The evening was hosted by Hilary Barry, who was excellent (relaxed, humorous, and fully engaged with the audience). Sponsored by Resene, the RentSkills…

Q My one-bedroom apartment in Auckland has been co-leased to a couple for the past two years. Over the weekend I received an email from my female tenant who disclosed her male partner was domestically abusing her. Previous incidents have resulted in police checks. However, no charges have been made. While she has a new tenancy lined up and somewhere safe to stay in the interim, she is unable to finance this move and pay out the 28-day notice period at the same time. She is also concerned her partner will react violently if he finds out she is leaving and wishes to do so without disclosing the tenancy termination to him. She has always been a trustworthy tenant and my priority is ensuring her safety. What are her rights…

YOUR RATES While it appears (at the time of writing) we are about to get an idea of what the new centreright coalition will look like over the next three years, we are still in the dark over how negotiations have progressed, which policies will be shelved, and what compromises will be made. Property investors have been eagerly waiting for reversals to policies such as Labour's rule around not allowing mortgage interest to be deducted as an expense, the shortening of brightline and bringing back the ability to terminate tenancies without cause. We will have to see how this plays out over the next few months and how aggressively the incoming government will look to cut regulations such as the CCCFA and other unnecessary red tape. Another point to watch…

RENOVATION Like many people working in and around the New Zealand property industry, I'm waiting with bated breath to see the next government find their feet and communicate a concrete policy around housing and infrastructure. Within the uncertainty of change there are signals that many are holding still. The current volume and nature of jobs posted on Builderscrack implies many property owners are focused on core maintenance and preserving value, rather than the higher volumes of new builds and large renovations we saw in 2021. This job data also paints a picture of two broad segments of property owners: those more leveraged, and those carrying little or no debt. Interest deductibility and interest rates generally have little effect on property owners carrying low debt, while those who are highly leveraged…

YOUR DEVELOPER New Zealand is fast approaching its hottest months of the year with summer just around the corner. During this time, where there are more temperature fluctuations and greater extremes, we truly begin to notice the thermal efficiency (or unfortunately inefficiency) of our homes. Whether it's the biting cold of winter or the humid discomfort of summer, the way in which a home is built can greatly impact our living comfort. While there are methods to cool our homes during the hot summer months, most require electricity. This increased energy demand not only raises electricity bills, but also contributes to a larger carbon footprint. To achieve a more thermally efficient home it is essential to focus on the building's structure and materials, placing emphasis on thermal mass principle and…

PROPERTY INSIGHTS I have found over the years that even the nicest, most well-meaning landlords can be held to task for accidentally breaching tenancy law. There have been untold cases where landlords have had to pay tenants a punitive amount of money for their unintentional behavioural wrongdoings. In my opinion, nothing is worse than trying to be a nice landlord, and then being held to task for something you didn't know you were doing wrong. To help you avoid some fines I have seen happen let's look at a few examples: 1 Entering the rental property without correct notice – up to $1,500: Some landlords are very friendly with their tenants and may have a casual agreement to visit the rental whenever they like. However, in a recent Auckland case…

NZPIF SPOTLIGHT The recent Sunday television report on Queenstown's rental housing shortage highlighted a nationwide issue in New Zealand: the diminishing availability of rental properties. An analysis of the Tenancy Services data shows a consistent decrease in new rental bonds since 2013, with a significant drop from 2019 onwards. As of March 2023, there are 402,195 active rental bonds, indicating a stagnation in the growth of the rental housing stock. With immigration increasing, a serious shortage in rental properties looms. To address this, the incoming government should take several immediate steps: 1. Reinstate tax deductions for interest as a legitimate business expense to disincentivise rental property owners from exiting the market and motivate new owners to enter the rental space. 2. Modify the Residential Tenancies Act changes that deterred landlords,…