Blog 8
Greg Ninness article published by
stuff.co.nz forecasts regions in New Zealand that may provide better investing
opportunities, Christchurch and Auckland are said to have housing shortages
where as places such as Hamilton and Wellington may be the place to invest as
rents are increasing. Figures from Real estate instate New Zealand showed that
many parts of Auckland and Christchurch's house prices are rapidly increasing
but rent prices are not which would mean that landlords wouldn't be getting an
acceptable return.
In Hamilton rents are increasing rather
than property prices so landlords would get a higher rental yield on their
investment. Wellington could also be a place to invest as the market is doing
similar to Hamiltons with renting prices increasing largely over property
prices. This is an upside for property investors looking to grow their
portfolios as rental yields are improving. Kate Shiels-Reddin part of the
Harcourts team in Wellington said that "overall rents were largely flat in
popular areas such the Hutt Valley"(Shiels-Reddin).
"Landlords were not expecting much
rental growth in the near future because the supply and demand for properties
to rent was largely in balance, she said"(Shiels-Reddin). Places such a
lower hurt and upper hurt are the regions increasing in rent value
over the CBD where median rent for a two bedroom property is down 5%.
Due to Wellingtons earthquakes early
July last year tenants have been very conscious as to renting in high rise
apartments, however are still popular with tenants working in the CBD. In both
Auckland and Christchurch rents were said to be up by 10% however
in similar suburbs house prices were increasing faster being up 20% from
the previous year. Many tenants in Christchurch are apart of the "casual
let" market where tenants are in houses for a short period of time whilst
there house is finishing earthquake repairs. Landlords in these situations
would charge extensively for short term leases.
It is said that getting good
returns for newly built houses is just as hard, Mr Kennedy said some people
were wanting between $1800 to $2000 per square metro to build new which would
mean you could build small three bedroom houses for as much as $600,000 and
these properties are not showing as much return (Kennedy).
In Christchurch a trend being made was
investors purchasing earthquake damaged home with no insurance. This meant
there is less opportunity for landlords to increase there portfolio.
Main focus point featured in the
article: The article outlines where investing opportunity is at a success and
where it is no throughout regions in New Zealand and how renting is becoming
more favourable.
The article published by stuff.co.nz
relates to Welly Real-estate as it details significantly as to which regions
are good for renting and buying and provides figures for Welly Real- estate.
Advise to Welly Real-Estate realting to
this article would be to focus on regions that have high growth profit in terms
of property prices, so focus house sales on smaller cities such as Hamilton and
Rotorua and become more of a business that focuses on
rental property management in regards to collecting commission when
taking over rental properties for landlords, as pricing for renting is at a low
all over the country, Hamilton is seeing an increase in rental properties’
prices so to increased the amount received from commission and further the
investment yield for the landlord the business could focus on these areas of
the country.
Works Cited:
Ninness, G. "Insiders guide to
investing in rental property". Web. April
7.2014. http://www.stuff.co.nz/business/money/9539298/Insider-guide-to-investing-in-rental-property
No comments:
Post a Comment