Fully leased Albany industrial unit

Colliers International directors Matt Prentice and Shoneet Chand are marketing the property for sale with Gary Seekup and Bruce Jiao of Barfoot & Thompson.

It’s for sale by deadline private treaty closing at 4pm on October 30, unless it sells earlier.

“This is a prime industrial investment property in one of Auckland’s most desirable business locations,” Prentice says.

‘Bucket toilet’ for garage tenants

New Zealand’s tenancy landscape – and what that typical landlord’s life is like – is under increased scrutiny as the government works through its reform of the Residential Tenancies Act. But commentators on both sides say the debate risks getting caught up on extremes – filthy tenants or reckless landlords – while failing to address the needs of those most vulnerable.

NZ Housing Market Slip: What It Means For Rentals

The New Zealand housing market is an interesting one which creates a number of challenges as well as a number of opportunities for home buyers, owners and investors. The real estate market in New Zealand is complex due to a number of reasons. There are a number of factors that were likely to contribute to a fall in New Zealand property values.

  • Interest rates have remained at a historic low for almost five years.
  • Property prices have basically doubled over the course of the last 15 years.
  • The New Zealand property market is the world’s third most overvalued.
  • Since 2002, the New Zealand mortgage bubble has grown 165%.
  • Almost one-half of the country’s mortgages have floating interest rates.
  • Mortgages account for more than half of banks’ loan portfolios.
  • Foreign investors, particularly from Australia and China, are inflating the property bubble.
  • The New Zealand dollar is overvalued.

Many analysts predict that the real estate market is in the first stages of what could be a large slow down. This prediction comes in spite of increases in property values over the last year which some analysts predict will continue through the rest of 2018 and perhaps into early 2019.

One of the signs that the demand is lessening is the time for existing properties to sell. On average, properties nationwide took one more day to sell than a year ago. They also point to the fact that the New Zealand housing supply is set to rise by record numbers, as well as other factors.

The largest driver of price increases is the shortage in the number of homes available. The construction of more than 44,000 new homes has been consented. This number is on top of a 39% increase in dwelling consents over the past two years. This level of growth is likely to continue into 2019 as the current increases still leave Auckland with a significant shortage and a rapidly growing population.

Infometrics has forecasted a nationwide drop in home prices of about 11 per cent by September 2019. Part of this drop is the result of government policies. Labour promised to lessen housing inflation and to build more affordable homes. They also promised to regulate real estate investment.

Some of the policies enacted to achieve those promises include:

  • Making it more difficult for foreign investors to buy existing property by classifying existing property as “sensitive land”. This creates a set of criteria which foreign investors must meet in order to purchase the property.
  • Property losses cannot be used to offset income tax on other income.
  • Increasing the taxable time period from two years to five years on profits from the sale of investment property.
  • Interest rates to rise and LVR limits to change.
  • Investing in rental properties has long been a way for many New Zealanders, and some foreign investors, to build capital.

This has been an especially solid investment strategy in times of housing shortages and rising property values as many potential buyers found the home they desired out of their price range or else simply not available. This has been particularly profitable for investors and property managers in Auckland where the housing shortage is most acute, a situation that is likely to continue for a few years.

Another area of concern for rental management companies, rent property managers, individual investors or a rental agency are the new rental laws in effect. Most of the new laws are aimed at improving tenants’ rights. The two key provisions of the new laws are an extended notice period for evictions and setting a limit for rent increases to once per year.

Another provision of the law is that all rental properties must be adequately insulated by July of 2019. Renters will have warmer and more comfortable housing, but many landlords will be facing increased costs as they perform the required upgrades to be following the new law. Some analysts feel that the increased costs could dampen the enthusiasm of investors and actually decrease the amount of rental property available. Those interested in investing in rental properties would be well served by obtaining an accredited building inspection report.

What Does This All Mean for Property Investors?

In general, those who invest in rental properties fare better when homes are in short supply and expensive. Many analysts feel these two conditions will change in the near future. However, that does not mean that investing in rental property now is a bad idea.

It is important for an investor to analyse market data and forecast to determine the likelihood of making a profit. Some of the factors to consider include vacancy rates, rental rates, the current months of inventory on the market, price trends and the number of distressed sales which may be available. Investors should also look at some of the long-term economic factors like employment trends and forecasts, mortgage rates and population growth.

Determining the overall profitability of a rental property investment can be fairly complex. Once again working with a professional to come up with a rental appraisal is recommended.

The basic rule of thumb is come up with what is called a housing cost factor (HCF). The HCF helps investors determine the annual amount of rent that must be collected as a percentage of the original price of the property. The factors that are considered include the interest rate, property taxes, property insurance, annual maintenance (usually calculated as 1.25% of the price of the property) and an estimate of the amount of time the property would be vacant per year.

With these tools in hand, we hope your investment properties in NZ flourish and grow despite the many changing tides.

What Does A Curb On Foreigners Buying New Zealand Homes Mean For You?

This year, New Zealand took a giant leap into unknown territory. The decision to ban foreign buyers from purchasing houses in New Zealand came as a result of steadily increasing home prices in NZ. Have a chat with any local Kiwi, and the topic of home prices will likely come up in conversation. The conversation is happening all over New Zealand, as young, first time home owners struggle to find and secure new houses to buy, or families looking to upgrade can’t find anything within their price range.

So, why did this happen?

There are quite a few different answers to the cause of the housing shortage in NZ, depending on who you ask. Many people believe that increased foreign investment caused available houses to shrink, and therefore prices to skyrocket. This cause is also one of the primary reasons for the new ban, as the thought is that more homes will be available to Kiwi buyers, and will eventually even out with the Kiwi market rather than the international one.

Other thoughts are poor planning and growth forecasting. Auckland, specifically, has grown faster and more intensely than city planners were prepared for, creating a severe housing crisis in a very short time. Even commercial property real estate was hit as many city planners failed to see Auckland becoming a hub for global companies.

What does it mean for you as a…

  • Foreigner

As the name suggests, the ban on foreign buyers in New Zealand pretty much means you won’t be able to purchase a home anymore. There are some caveats, however. If you already have property in NZ, you won’t be losing it or losing your ability to sell it in the future.

Also, if you already have residency status in New Zealand, you are not banned from purchasing. This means if you’ve gone through the process or are going through it to become a NZ resident, you’ll still have buying rights. If you’re from Australia or Singapore, you’ll keep your rights to purchase in New Zealand as well. You will still need to gain permission via a screening from the Overseas Investment Office before the purchase.  

Another caveat is that you are still able to purchase specific types of apartments, like large apartment blocks and hotels. This means that investment property and management is still a great option for foreign buyers. The building must be at least 20 dwellings, and will need to be screened by the government. If you’re thinking of purchasing property like this, make sure to get property investment advice first to ensure the property qualifies.

  • Kiwi

There are plenty of economists out there who disagree with this ban. Some reasonings is that the data shows that only 3% of purchasers don’t hold NZ residency, which makes it seem as though there isn’t a problem at all with foreign buyers. This would mean that the ban will not actually help Kiwis purchase affordable housing, as there was very little being purchased by foreigners in the first place. Regardless of the positives and negatives of the ban, the idea is that property will be easier to purchase for Kiwis in the future.

While it’s much too early to tell if the ban will be successful, what we do know is that the housing market was starting to slip prior to the ban. This is technically a good thing for the buyers who want to quickly purchase on the slip prices, and for first time home buyers. First time home buyers can also cash in on the Kiwisaver first-home withdrawal, which can help with a downpayment in this market. For current property owners, however, a slip could mean a drastic loss in equity, and less movement in the market as owners will stay put.

On the positive side, the ban may help first time home buyers the most, as they previously were having difficulty even entering the market. Competition for open home and auction sales was creating a market where new home buyers were purchasing without ever even seeing the home or being able to get a building inspection before buying a house. Again, this ban will hopefully create some breathing room for those who are attending home auctions every Sunday without any luck.

Buying property as a Kiwi, post the ban, will still require some steep competition as there was an increase in foreigner buying prior to the ban being official. Panic buying, on both sides, was prevalent for several months, but will soon calm down as the ban settles in. Even those residing in New Zealand, but without permanent residency, were snapping up homes as quickly as possible to make sure they didn’t lose out later on, or lose their chance at buying at all.

What does the future look like?

At this point, and without being an expert, we can only guess what the future will hold for New Zealand property prices. What we do know is that any big change will take some time, and a Kiwi buyer may need to be patient for a few more years while the market changes. There are plans in place to start building significantly more homes than have previously been built, which will help flood the market with more available properties.

When you’re out on the market looking to purchase a home, you will now only be outbid by other Kiwis, which for some New Zealand residents is a beautiful thing. Regardless of your thoughts, be smart when investing or buying a home, use a property lawyer or a housing solicitor for the process, and stay up to date with the latest homes for sale to ensure the best sale for you.

Top Eight Things Your Spring Clean Should Include

We’ve made it through winter! The slush and the ice and the cold temps are gone, but now we’re left with that grime and grit that winter so kindly left us as a parting gift. Spring cleaning is that perfect time to push open the windows and let a brisk spring air fill the home as you clean. Nothing is quite better than lighting a lavender or citrus candle after a fresh mopping and vacuuming, or, perhaps that’s just us!

Regardless of your feelings towards spring cleaning, it’s just one of those things you can’t get away with ignoring. We’ll go through the top eight things that your spring cleaning should include in this article, hopefully making it easier for you to narrow down the most important things you tackle first, inside and out.

INSIDE

Declutter

Before you start anything, start decluttering. By clearing away space in your home, you’ll be able to access those hard to reach cleaning spaces, as well as making your home feel lighter and brighter. Start small, and just do a little bit every day to tackle bigger decluttering jobs. Use some of these tips for decluttering if you’re feeling especially overwhelmed.

Windows

Interior window cleaning is one of those terrible tasks that is required for that sparkly feeling, but is certainly not a fun one. If your windows are small enough and relatively clean, making your own solution or using a bit of dish soap should do the trick. Here’s some additional great tips for cleaning windows to get you started. If you’ve got floor to ceiling windows, however, or some especially neglected ones, it may be worth it to hire professional window cleaners to get the job done well.

Kitchen

Hopefully you’ve been keeping your kitchen clean all winter, but that doesn’t mean that it couldn’t use a deep spring clean. A couple of times a year is best to really pull everything out of your refrigerator and clean behind it, as well as deep cleaning your oven and stove. Use a mixture of homemade cleaners and store bought oven cleaners to help really tackle the job.

Mattress and carpet cleaning

Oh, the joy! Deep cleaning these fabrics is not something anyone gets excited about, except for perhaps professional carpet and upholstery cleaners. This is definitely a job that we won’t judge you for bringing in experts to take care of it for you, but if you’re feeling up to the challenge then here are some ways to make the job easier. Carpets can be cleaned with a mixture of baking soda, water, and a bit of soap and some determination on your own. Leave the mixture on your carpet for a few minutes, then scrub and let dry. Vacuum the whole area once it’s completely dry.

Mattresses aren’t always at the top of people’s cleaning lists, but ought to be considering how much time we spend in them. Your mattress will accumulate skin cells, hair and dirt throughout the year. Clean it by removing your bedding to wash, then clean with a similar concoction to the carpet cleaning above. Sprinkle baking soda to help absorb any odours and moisture, then vacuum off after a couple of hours. Any stains can be treated the same way you’d clean a carpet.

OUTSIDE

Security

Winter may have taken a toll on your outdoor technology, like your security systems and cameras. Make sure that your security system monitoring is in good shape and that any alerts or alarms are still programmed appropriately.  Fix locks that have rusted over or have weakened as a result of the winter temperatures. Occasionally you may need to clean any cameras you have set up, as residue may have built up over the winter.

Wash your home

Exterior house washing is an excellent way to remove the grime from your home and have it fresh and sparkling again for the summer. Not only does it help your house look like new again, it can keep your home in better condition year after year. If you live near the sea, the salt can cause some serious damage to your home’s exterior and paint job. Washing will help keep the paint fresh and lasting year after year.

Clean gutters

Window and gutter cleaning is also an absolute essential for spring. Gutters, when clogged, can cause some serious damage to your home. Think about it – gutters are meant to divert the rain from your roof and home to a designated area where it is safe to pour and drain away. If your gutters are clogged, the rain won’t be diverted and will instead potentially seep into your home through the roof or the foundation, causing flooding or structural damage. You may find yourself needing carpet cleaning and restoration

Storage areas

When you haven’t used your storage areas all winter, chances are they’ll need a good clean. Think about places like your boat storage area. It’s possible that rodents or other furry animals made a bit of a home in there, and you’ll gently need to relocate them. Other storage areas, if off the property or well hidden, may even have been tampered with. If a room or building looks suspicious, you may need to call in a meth testing company to check for signs of a meth lab.  

Okay we know this list may look a bit daunting, but don’t despair! Each one can be delegated to a family member if you’ve got available ones, or taken in small chunks. And to be honest, spring is not a hard and fast deadline to get these finished. We have a little secret for you: if you need to spread out your spring cleaning over a couple of months, no one is going to find out, and we won’t tell! Happy spring!

Fined for missing real estate million

Auditors are required to report a loss or deficiency of trust account money to the Real Estate Authority – the government body responsible for regulating the real estate industry – and the protection of consumers.

Khan was aware of the missing funds between May and September 2017 and failed to report this. Over this time, the misappropriated funds were neither sufficiently explained nor returned.

The Block buyers ‘got a good deal’

“The median price for three-bedroom homes for the three months ending August 2018 was $968,888 which means that at a sale price of $1.009m Amy and Stu sold their house for 4.2 per cent above the median price for Hobsonville Point,” she said.

$2m squat: Landlord calls in bailiffs on illegal dwellers

The New Zealand Property Investors Federation says the long waiting times for a court bailiff is unacceptable – and is calling for an overhaul of the Tenancy Tribunal.

The federation’s executive officer Andrew King said it now took about two weeks for landlords to engage a court bailiff.

“While this used to be free for landlords and take just a few days to organise, it now costs $200 and takes about two weeks,” King said.

Rules on cheaper homes

Four special housing areas in the works could deliver about 2600 homes to Hamilton – and the city council has decided at least 10 per cent of them must be affordable.

Defining that proved tricky, but city councillors did on Tuesday: a sale price 90 per cent of the average Hamilton home value, or less.