NZ Property Investor June 2024

To insure or not to insure – that is the question. Bad Shakespeare appropriation aside, the question of whether (or not) to get landlord insurance is a sticky one. Insurance can be a big expense – especially in this economic climate. But the alternative – being uninsured for damages, lost rent and meth contamination – will be much more costly. Sally Lindsay investigates landlord insurance in our lead story this month. She outlines how specialist insurance can be a lifesaver when the worst (or even the just slightly annoying) happens – covering everything from carpet stains to missing rent after a natural disaster. Specialist brokers are the best go-to regarding your specific needs. Some insurance policies cover rent arrears, some don't. Some cover damage that isn't accidental (for an extra…

Many property investors haven't returned to the market despite the reintroduction of 80 per cent interest deductibility for landlords and the lowering in July of the bright-line test from 10 years to two, QV says in its latest update. QV operations manager James Wilson says the looming introduction of debt-toincome restrictions will almost certainly hamper their ability to buy existing property when it eventually happens. “Residential property values have mainly plateaued across the country, domestic inflation remains stubbornly high, the unemployment rate is rising, business confidence is low, and cost of living pressures remain a significant challenge for many households,” he says. Waikato registered valuer Marshall Wu says cost of living pressures remain a significant challenge for many households, resulting in lower savings rates, persistently low sentiment, and increased uncertainty…

As a landlord, you want to protect your investment, but you don't want your rental to remain vacant for a long period of time, which damages profit potential. While you might be tempted to rent the property quickly, renting your unit to unqualified tenants may cause costly, time-consuming problems down the track. For example, if you end up with a tenant who fails to pay rent, you may end up having to evict them and start again. All landlords will have their own ideas on what makes an ideal tenant, but there are three basics that can't be ignored. • Respect: For example, they don't have six people sleeping there when the property is only for a family of four. They also don't keep pets secretly when the rental agreement…

The central bank says it probably won't start cutting the official cash rate until the middle of next year, but some bank economists and the financial markets think otherwise. ASB, ANZ and Kiwibank have recently cut their mortgage rates. Kiwibank is the first to have its one-year fixed rate drop to below 7 per cent. RBNZ data for March shows residential investor lending, although in the doldrums compared to the 2021 peak when investors were knocking first home buyers out of the market, rose to $1.3 billion last month and 45.7 per cent of that was on a one-year fixed term, up from 41.4 per cent in February. In the owner-occupier market, the one-year fixed term accounted for 42.1 per cent of all new mortgages, up from 38.9 per cent…

Mark and Denise Fincher have been ordered by the Tenancy Tribunal to pay their tenants $334.72, which is four days of rent paid for a self-contained apartment on the ground floor of their Northland house. Before the tenancy started, one of the tenants had accepted a job in Paihia, had seen the property advertised for rent, applied for it, was sent a video, agreed to rent the property and signed a tenancy agreement for a fixed term from August 18 last year to February 18 this year. The tenants, who were given name suppression by the tribunal although they did not apply for it, did not have the full $1,650 bond and the Finchers’ agreed to initially accept $500 and two weeks rent in advance on the understanding the tenancy…

MATTHEW GILLIGAN Matthew Gilligan is a property investor, developer and tax adviser. He is managing director of chartered accounting firm Gilligan Rowe & Associates, where he heads the specialist property and asset planning divisions. KRIS PEDERSEN Kris Pedersen of Kris Pedersen Mortgages is a commentator on property and finance. His team sources top finance strategies. Phone 09 486 4719, www.krispedersenmortgages.co.nz MARK WITHERS Mark and his team specialise in advising on propertyrelated transactions, valuation and restructure services, and tax planning. Withers Tsang, phone 09 376 8860, www.pfkwt.co.nz RYAN WEIR Ryan is managing director and franchisor of Propertyscouts NZ. He's deputy chairman of the RPMA and is passionate about the property management industry, particularly raising industry standards. SHANE CAMPBELL A partner in Wynn Williams’ Dispute Resolution Team, Shane specialises in complex commercial…