Nz property investor august 2016 by read_m11333

REGIONAL REVIEW: OPPORTUNITY IN PALMERSTON NORTH AUGUST 2016

BALANCING ACT: HOW TO HANDLE HOUSING MARKET GET TOP DOLLAR: LESSONS FROM THE BLOCK

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Contents UPFRONT 03 EDITORIAL

Have we peaked yet?

AUGUST 2016

04 STATCHAT

A decade of sales’ supply.

06 NEWS

Latest news aﬀecting property investing.

13 YOUR MORTGAGE

What you need to know about joint ventures, with Peter Norris.

14 YOUR HOUSE

The heated housing market reaches fever pitch.

FEATURES 20 PROFILE: BLAIR ANDERSON AND NATALIE PERZYLO Pet-friendly equals proﬁt for these Christchurch investors.

26 LEAD: HOW TO HANDLE

CHANGES IN THE MARKET

Experts give their views on the property cycle and new strategies for investors.

32 FEATURE: THE BLOCK

Hot tips for achieving top dollar at auction from Block insiders.

40 RENOVATION: RAISE THE ROOF How you can save money by maintaining your roof.

ADVICE 16 ASK AN EXPERT

Our panel of experts answer your questions.

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COLUMNS

44 YOUR BANKER

Jeremy Stapleton outlines the Reserve Bank’s proposal for new LVRs nationwide.

45 YOUR ACCOUNTANT

The tax ramiﬁcations of renting your property as holiday accommodation, with Mark Withers.

46 YOUR PROPERTY COACH

Sue Irons uncovers the real reasons that prevent investors from buying more property.

47 YOUR APARTMENT

New-build apartments are a great investment, writes Aaron Tunstall.

48 YOUR PROPERTY FINDER

Why new lending regulations are good news for investors, with Campbell Venning.

REGIONAL REVIEW PALMERSTON NORTH: Slow and steady.

REGULARS 58 FROM THE EXECUTIVE OFFICER'S DESK

49 YOUR PROPERTY MANAGER

Air BNB is changing the landscape of property management says Sarah Dawson.

It's tough times for investors, writes Andrew King.

60 PROPERTY INVESTORS’ FEDERATION What the associations are planning for August in your area.

80 BOOK REVIEW:

Phil Campbell reviews John Lindeman’s Unlocking the Property Market.

STATISTICS 64 STATISTICS

Find out the median returns for rentals in your area.

75 SALES STATISTICS

Median house sale prices and numbers sold by region.

78 CLASSIFIEDS

All the best professionals from your region.

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NZ Property Investor magazine is brought to you in association with 2

NZ PROPERTY INVESTOR

AUGUST 2016

FROM THE EDITOR NZ Property Investor Magazine Ltd Postal address PO Box 2011, Rotorua Physical address 1448A Hinemoa Street, Rotorua T 07-3491920 F 07-3491926 www.propertyinvestor.co.nz www.landlords.co.nz

NZ PROPERTY INVESTOR MAGAZINE PUBLISHER Philip Macalister E Philip@propertyinvestor.co.nz

EDITOR Joanna Jeﬀeries E editor@propertyinvestor.co.nz

SUB-EDITOR Phil Campbell

ARE WE

THERE YET?

STAFF WRITER Miriam Bell E miriam@tarawera.co.nz

ADVERTISING SALES T 0800 345675 M 0274 202 069 F 07 3491926 E sales@propertyinvestor.co.nz

PRODUCTION Jon Harding, Debbie Morgan

SUBSCRIPTIONS Dianne Gordon T 0800 345675

To subscribe go to www.propertyinvestor.co.nz To change your address or subscription details go to www.propertyinvestor.co.nz/coa

CONTRIBUTORS Sarah Dawson, Allan Galloway, Nick Goodall, Phil Campbell, Amy Hamilton Chadwick, Ron Hoy Fong, Sue Irons, Jenny Keown, Andrew King,Vicki Holder, Myles Noble, Peter Norris, Bernard Parker, Kris Pedersen, Krister Samuel, Jeremy Stapleton, Aaron Tunstall, Mark Withers, Campbell Venning.

PHOTOGRAPHY Rebecca Claridge

IN THE CURRENT CLIMATE OF HIGH NET migration, lack of housing supply, low interest rates and aggressive bank lending the question on everyone’s lips is: has the market peaked? Or alternatively, when will it peak? To add fuel to this debate, the Reserve Bank’s proposal to tighten its macroprudential policy on mortgage lending will mean investors across the country will be subject to a 40% equity restriction from September this year. This latest move is the biggest regulatory change investors have seen for quite some time and only time will tell how much of an impact it will have on cooling the ‘hot’ market. Could it be the straw that finally breaks the camel’s back? As the dust settles

on this announcement, we will no doubt get more of a sense of how it may impact the housing market and investors. Our feature piece, 'Balancing Act: How to Handle the Housing Market' (26), is rather timely given RBNZ’s latest move and gives insight into the varying opinions of industry insiders - each with their own view on where we currently sit in the cycle and what your next strategic move should be. Speaking of strategy, this month we cover more than one. Our feature on The Block season five (p32), lets you in on all the lessons gleaned from hosts, judges and contestants on achieving top dollar at auction and shows how high-end renovations can reap great rewards. On a completely different strategic level, our profile couple this month, Blair Anderson and Natalie Perzylo, take an original approach to rapidly growing a property portfolio. Their love of man’s best friend has helped increase their portfolio from one to 14 income streams – all petfriendly properties - in just a few short years. Read more on p20. Happy reading.

Joanna Jefferies Editor

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STATCHAT

SPOTLIGHT ON SUPPLY the supply side of the housing market has changed over the last 10 years by comparing the number of houses listed on Realestate.co.nz in June 2016 compared to the same month in previous years. In June 2016 there were 21,600 properties

listed for sale which is 60% less than in June 2008 (the period with the highest listings over the 10-year period) when there were 54,000 listed. For 15 of the 19 regions June 2016 inventory was lower than for any other June period since 2007. Four regions had over 70% lower

inventory in June 2016 than June 2008. They are Bay of Plenty, Central Otago, Hawkes Bay and Wellington. The graphs below show percentage changes in inventory levels compared to 2007 for the nine larger regions.

There has also been a reduction in new listings coming on to the market over the last 10 years though the changes are less dramatic than the changes in total inventory. There were 9,300 new listings in June 2016 which is 31% less than were listed in June 2007 (the period with the highest

number of new listings over the 10 year period) when there were 13,400. Only four of the 19 regions had the lowest number of new listings in June 2016 compared to previous Junes since 2007. Four regions had over 50% fewer new listings in June 2016 than June 2007. They are all smaller regions, namely Coromandel,

Hawkes Bay, Wairarapa and West Coast. The final factor in the supply and demand equation is the number of sales. REINZ data shows monthly sales dropped 42% from 7,474 in June 2007 to 4,305 in June 2008. Since then they have been working their way back up and exceeded June 2007 for the first time in June 16 with 7,864 sales.

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UPFRONT NEWS

NEW LVR HITS HARD NEW AND SMALL-SCALE PROPERTY investors are expected to be hit particularly hard by new rules that heavily restrict lending to landlords. Banks have been told that from September, no more than 5% of their lending should be to investors with a deposit of less than 40% of a property’s purchase price. But banks are clamping down early and shutting down lending already. James Lockie, of General Finance, says it will have unintended consequences for the Reserve Bank, which is trying to retain stability in the housing market. He says most people who have been homeowners for a number of years will have enough equity that the new rules won’t bother them. Those most affected will be young investors starting out, he says. “It just means a different group gets to buy [investment properties]. It can’t be first-home buyers buying investment properties flatting with friends. But it does allow someone who has had five or 20 years to buy another one. That’s not necessarily what the Reserve Bank was aiming for.” Financial adviser Hannah McQueen says it is pushing young people to buy a home to live in, when sometimes buying an investment property would be the most sensible starting point. “They spend more because they want to live in [the property] and are emotionally attached, it just doesn’t make sense.” Andrew King, executive officer of the New Zealand Property Investors’ Federation

Andrew King says while landlords have become an enemy in the eyes of much of the public, most New Zealanders do not realise that the vast majority of landlords are operating on a small scale. “They’re not the buy/sell mega-rich fat cats that everyone makes us out to be. Realistically it is the small investor who is going to be affected,” he says. King says it is likely rents will rise as a result. “If you make it harder for people to provide rental properties, you are making it harder for their tenants. Rents are going to go up as long as they keep whacking property investors. Everyone needs a home and at the moment tenants are really struggling. There’s a lot of overcrowding going on.” A Horizon poll found 22% of people

who say they had been planning to buy an investment property in the next 12 months would not do so if they are required to have a deposit bigger than 30%. Another 21% say they would delay. About a third would still buy. Horizon says the new policy will have a slightly greater impact in the Auckland market: 29% of the Auckland respondents definitely looking to buy an investment property say they would not buy if the deposit required increased above 30%. Another 17% say they would delay buying, while 27% say they would still buy. Commentator Olly Newland says those who are in the market for capital gain will form partnerships and groups to purchase properties regardless. “They won’t think about the nuts and bolts of how it will all work, and there will be problems.” He says it is likely investors will focus their attention on new builds, which will remain exempt from the LVR rules. “They will start putting money into new builds and that will push new build prices up. So that will make it harder for firsthome buyers again,” he says. "Also, it means we now have a fullyregulated market which dictates who can buy and what they can buy. And we don't want that. We want a free market. So there are definitely consequences. Mostly bad. The only positive is that it will dissuade people from going completely crazy. We all think house prices are too high. So if this tempers the market that will be a good thing.”

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6 NZ PROPERTY INVESTOR // AUGUST 2016

UPFRONT NEWS

WHAT LANDLORDS CLAIM THE MOST Intentional damage might be landlords’ biggest concern about tenants, but it turns out it’s not what they turn to their insurers for most.

ALMOST 90% OF LANDLORDS ARE worried their tenants may damage their investment property, according to a new survey by AA Insurance. Landlords’ next biggest worries are the possibility of missing rent payments (88%) and then contamination of the property due

to the consumption or production of illegal drugs (87%). However, over the 12 months to May 30, 2016, the most common type of landlord claim was actually for accidental loss or damage to property (25%). This was for things like a hole in the

wall or stain on the carpet, as opposed to intentional damage. AA Insurance spokesperson Amelia Macandrew says landlords should be reassured by the survey findings. “There’s a gap between what they’re most concerned about and the types of claims we see most often - accidents that can happen in any home. “While accidental loss and damage is more prevalent than intentional, it’s important to remember that it can still happen so it pays to have the right insurance.” The survey also found that the contamination of rental properties by illegal drugs was a growing concern for landlords. Macandrew says it pays for landlords to check they have the right insurance for their circumstances as insurance is designed to cover sudden and unforeseen damage. “Loss of rent and natural disasters are generally available under standard cover. “But landlords should check with their insurer for optional benefits for tenants who leave without notice, are evicted, cause intentional damage, or who use or make illegal drugs. “That way, if the worst does happen, their investment will be protected.”

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OUR TOP FACEBOOK POSTS & COMMENTS

Join in the discussion at Facebook.com/NZPropertyInvestor

The Property Institute has slammed the Reserve Bank's proposed lending restrictions for investors which were announced in July. We asked our readers if this had them rethinking their next investment?

YOUR COMMENTS Mark Charlesworth: I can't aﬀord a 40% deposit on an investment property now and most likely won't buy a second house for a while. Strategy will most likely be to buy, reno and live in the

10 NZ PROPERTY INVESTOR // AUGUST 2016

house and then sell to get my deposit out for the next one. Will have to do this until I have enough equity for a house I can call my forever home and afford some investment properties. Going to be hard. Kirstyn Tait: Luckily we have just purchased another investment property as I had a feeling this would happen so I moved quickly to utilise our equity. I wasn't expecting it so soon though, I thought it would come in at the end of the year. This will most likely mean holding off for at least five years before we purchase the next property, we will need to pay down more on the properties we currently hold.The question is whether this will just be a temporary thing, if the market stabilises will they then relax conditions in one to two years’ time? Jess Riou: How are they going to define property investors? At what point do you qualify to be one? I hope first home buyers are not included in that new "law". That would, again, give the advantage to people already owning a couple of houses who will easily have 40% equity... Dominic Sutton: Doesn't change anything for cash buyers who are leveraging low interest rates from overseas banks (or just cash). Missed an opportunity to restrict foreign buyers to only new homes in greenfield sites. Janna Maree Vowles: It's going to totally change my next property move, if I can even still buy that is. This combined with the "p" issues that we have now has me rethinking my strategies. Whittaker Hamilton: Investors can still do renos to buy and sell. The house they use will need to be the one they live in though. Dillon Wilson: Will also put upward pressure on rents to ensure the same return on investment as before. As per normal the only ones who lose out are the ones not targeted.

Prime Minister John Key says the Reserve Bank should consider targeting investors with tough new lending rules. Our readers responded.

YOUR COMMENTS Owen Moﬃtt: Yeah its real smart, we have an under-supply of rentals.... homeless, people need housing... so let's target investors... good luck with that. Property doubles in value roughly every seven to eight years in Auckland, has done for the last 130 years. It hasn't gone anywhere in a long time so it's just caught up and will sort itself out. Mike Dolan: The fundamental problem is lack of supply. Address that and prices have to level out. If everybody has more choice, the supply can't be overpriced, or it won't sell or rent. Restrict investors, and you limit the supply again. But an election is pending isn't it? Andrew Berryman: Don't target the whole country because Auckland is bursting!!! Adam Andrews: Seems like a pragmatic approach. What's the alternative, increase interest rates? Introduce CGT? No thanks.

TOP STORIES Tougher investing rules, property hotspots and the struggle to buy property were hot reads over on the Landlords website in July. Reserve Bank calls for changes to investor LVRs The news late in July that property investors would have lending restricted was top of mind. The Reserve Bank released a consultation paper proposing changes to loan to value restrictions (LVRs). It was claimed that the idea to restrict lending to property investors with less than 40% equity would make life easier for experienced landlords.

Top 10 hotspots set to boom There is no exact science to picking future property hotspots, but there are ways and means to help establish areas with good growth potential. In the July issue of NZ Property Investor magazine, we uncovered the 10 spots around New Zealand with the greatest growth potential in 2016. The top 10 list was made up of a diverse

range of suburbs scattered across the width and breadth of the country.

Buyers struggle to ﬁnd properties Readers were interested to read more about the struggles to snap up new property as new data from the Real Estate Institute revealed there were fewer properties available for sale. The REINZ's June data showed a 40% drop in properties available for sale, yearon-year. Wellington had the least available stock – with only seven weeks’ worth of property listed.

RBNZ signals tougher rules for investors Advance warning of a change to lending restrictions was one of our top stories for the month. Reserve Bank deputy governor Grant

Spencer told the Wellington branch of the NZ Institute of Valuers that growing imbalances in the housing market required policy action on a number of fronts. This story was published earlier in July, some two weeks before the consultation document was announced.

5 Investors in the line of fire Our final entry into the top five was another story to do with the tougher lending restrictions. One investor advocate said these restrictions were misguided. NZPIF executive officer Andrew King says that, over the past year, landlords had been stung by higher LVR ratios, higher risk weighting requirements and the bright line test. “There comes a point when you have to ask, if all these measures aren't slowing house price growth perhaps we are shooting at the wrong target.”

To keep up to date with the latest news and statistics go to Landlords.co.nz

YOUR MORTGAGE

JOINT VENTURES A GOOD IDEA? Because of the rising property market, joint ventures are becoming common. What risks are involved? Peter Norris investigates. AS PER THE WORDS FROM THE GREAT Bob Dylan: “The times they are changing”. It’s widely known that the property market is pretty crazy and has been for some time now. Up until this point though, the Reserve Bank has been concerned enough to place restrictions on banks’ lending ability in an attempt to slow the market. These haven’t really worked, apart from an early Christmas market slump that came following last year’s October changes. This really only lasted until February though, and since then it’s taken off again. With the prices continually on the rise and banks tightening lending criteria, Joint Ventures or JVs, are now becoming a common scenario I see coming across my desk with friends and/or family coming together in order to increase borrowing power, or simply get a foot in the door. It’s important to look at what considerations need to be made before jumping into a JV property deal.

What’s involved? Firstly, what is a JV? For the purpose of property, a joint venture is a structure by which two or more people combine to purchase property together without the formality and commitment involved in forming a partnership or other similar entity.

DO THE WORK AT THE START TO MINIMISE LATER RISKS

and would be referred back to in the future should any disputes arise. You can easily Google some templates and complete these yourself without spending money on lawyers.

The proportion which each partner contributes can be 50% each, or it can be in unequal amounts, with one contributor providing a majority of the resources for the formation and initial operation of the venture. The area of contribution is a good place to start. With what is each person coming to the party? In most scenarios I have seen, two (or more) people bring different strengths, one bringing the equity (deposit) and the other the servicing (income). It could also be that one party brings renovation experience, or even the time needed to actually manage the project and ensure it is completed. This can work really well, but which has a greater impact on the final outcome and therefore who has the bigger piece of the pie? Working this out at the start is important to prevent any arguments about profit distribution down the path. These questions should be answered within a joint venture agreement, and this should be done before any money is spent. This document simply outlines all agreements at the start in a few pages

Exit strategy Finally, what happens if it all goes wrong? What is the exit strategy? If it is a property trade, then at what point is the property sold? Do you use an agent or sell it privately? And what happens if the market turns mid-project and you have to end up holding the property (this is an important one in the current market). If the renovation goes over budget, or it all becomes unprofitable and starts costing more money than expected, then how do you get out? If it is a buy and hold property from the start, then what happens if one person wants to get out but the other wants to stay in? This is very common given that life can change and along with it, people’s priorities. This article may not answer questions, but it should create some if you are thinking of a joint venture. I really like the idea of bringing people’s strengths together for a greater objective. But like any relationship they can be easy to get into, and hard to extricate yourself. So do the work at the start to minimise later risks.

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UPFRONT YOUR HOUSE

EVER EXPANDING

IMPACT CONCERNS OVER THE COUNTRY’S HEATED HOUSING

market reached fever-pitch this month. While Auckland remains the focus of much of the worry, supercharged price growth and increasing pressure can be seen in a number of markets around the country. These trends are evident in the latest round of data, a fair swag of which points the spotlight away from New Zealand’s largest city. A spreading “halo” effect from Auckland may be a significant factor. But, whatever the case, the impact on financial stability is bothering the Reserve Bank and it is tightening the screws on investors in response.

The heat of Auckland’s housing market has continued to spread to markets around the country and the end result has been further lending restrictions for investors, writes Miriam Bell.

values 52.1% higher than in 2007. Nationwide values rose by 5.6% over the past three months and by 13.5% year on year. This leaves them at $590,909 which is 42.6% above the 2007 market peak. Once adjusted for inflation, the annual increase drops to 13.0%, which leaves values 21.6% higher than in 2007. QV national spokesperson Andrea Rush says many housing markets around the country are being driven by strong investor demand, low interest rates, rapid price growth in the Auckland market and strong net migration. But it was the Hamilton market which saw the highest growth with a 29.0% year on year increase in values.

Falling interest Auckland’s prices have reached a point which is putting many property buyers off, Realestate.co.nz suggested on the release of their June data. Their data shows the city’s average asking price reached a record high of $888,493 in June. Realestate.co.nz CEO Brendon Skipper says this price was almost out of reach for the average income earner. Further, as prices continue to rise, theoretical yields for Auckland property investors continue to drop. These factors could constitute a turning point for the SuperCity market, he says. In fact, Realestate.co.nz’s data shows that many property buyers are already looking away from Auckland. The number of users searching Auckland houses “for sale” fell by 19.33% in June, as compared to the same time last year. Engagement measures also fell by more than a third across the Auckland region in June, as compared to June 2015. Skipper says it appears buyers are moving away from looking in the Auckland area in favour of other regions. For example, searches for properties in Northland, Hamilton, Tauranga and Queenstown were up significantly in June, as compared to the same time last year.

Soaring values While interest in Auckland property may be falling, that has not stopped the city’s values rising. And that ongoing ascent is one of several factors contributing to increasing nationwide values. According to the latest Quotable Values (QV) data, Auckland values increased by 4.7% over the past three months and by 16.1% year on year. This leaves them at $975,087 which is 78.4% above the 2007 market peak. Once adjusted for inflation, the annual increase drops to 15.6%, which leaves 14

NZ PROPERTY INVESTOR

AUGUST 2016

Tight supply As has been well-noted, constricted supply is a key part of the equation. Further confirmation of this came in Barfoot & Thompson’s latest data. It shows increases in both Auckland’s average sales price (to $908,343) and its median sales price (to $839,500) in June. But Barfoot & Thompson managing director Peter Thompson says prices have edged up slightly – and this is largely due to limited supply. He says the number of sales (1168) and new listings (1170) are consistent with the same period last year. “The moderate increases in the average sales and median prices are a measure of a very tight supply situation. At month’s end we had 2936 properties on our books, which is marginally lower (2.6%) than the previous month’s 3013.” In Thompson’s view, the fact prices are only up moderately demonstrates purchasers are maintaining a level head in terms of the value they see in the properties on offer. “These are signs that vendors are similarly realistic, even in a constrained market.”

Increase rate slowing Auckland’s prices may have continued on an upward trajectory, but the pace has slowed in recent times. Trade Me Property’s June data provides more evidence that the heat could be coming out of the market. Head of Trade Me Property Nigel Jeffries says since June last year, the average asking price across all the properties on the site has increased by over $46,000. “That’s an easing. For example back in September we saw a 12-month jump of over $80,000. This is a sign that the foot may be coming off the accelerator.” Significantly, the change was most noticeable in Auckland, where

prices were up 0.7% on May to a new high of $848,100. Jeffries says that while Auckland’s asking prices were up almost $75,000 year on year, that is significantly down on August 2015 when there was a leap of $130,000 in a year. “For now it looks like the incredible surges we’ve seen in Auckland may be slowing down. That’s not to say the market is stalling, but we’re seeing the market take a bit of a breather after sprinting ahead for months.” While Auckland was easing in June, its immediately surrounding regions powered on. The average asking price in the Waikato hit $435,000 in June, up $78,000 on June 2015. In the Bay of Plenty, the average asking price went up $88,400 in the past year to hit a record $543,800. And in Northland the average asking price rose 14% to $445,500, up $54,700 on June 2015.

No let-up Meanwhile, the latest Real Estate Institute of New Zealand (REINZ) data shows prices rising and supply constricting in regions around the country. Five regions hit new record high median sale prices in June – although the national median price dropped by 1% to $500,000, as compared to May. The five regions which reached record highs were Auckland (up to $821,000), the Waikato/Bay of Plenty region (up to $438,000), Northland (up to $360,000), Otago (up to $295,000) and Central Otago Lakes (up to $730,050). However, the number of sales in June 2016 dropped to 7,864, which was down by 13% on May. Once seasonally adjusted, the number of sales fell 3% from May to June. This indicates that sales were weaker than expected for this time of year. REINZ spokesperson Bryan Thomson says that although there is much discussion about increasing new build supply, the fact remains that the vast majority of the supply comes from the sale of existing properties. “The inventory data continues to show rapid declines in the volume of properties available for sale right across the country, with a number of regions, such as Wellington and Hawke’s Bay, recording very low levels of properties for sale.” This places pressure on the market and, in turn, has an impact on sale numbers along with the prices achieved. Auckland’s influence on the national picture is waning due to its own weaker sales and the strong growth in sales in other regions, Thomson adds. “Auckland’s peak share of national sales was 39.7% in January 2014, however, its share is now just over 33.8%. Over the same period Waikato/Bay of Plenty’s share of national sales has increased from 14.3% to 19.0%.”

Financial stability House price inflation in Auckland has long been a worry for the Reserve Bank, which sees it as a risk to the country’s broader financial stability. More recently, the strength of house price growth in markets around the country has also been a bother. At the Reserve Bank’s June meeting, it was indicated that the introduction of further macro-prudential policy, to curb investor activity and thus the housing market, was likely towards the end of the year. However, evidence of the spreading heat of the Auckland market, and the related political and public pressure, seems to have prompted the Reserve Bank into earlier action. In July, the Reserve Bank released a consultation paper proposing changes to LVRs to further reduce risks to financial stability arising from the current boom in house prices. One of the proposals is to restrict bank lending to investors around New Zealand to an LVR of greater than 60% - ie: to a deposit of 40%. Reserve Bank governor Graeme Wheeler says the banking system is heavily exposed to the property market with residential mortgages making up 55% of banking system assets. “Investor lending has been increasing rapidly and is a significant contributing factor to the current market strength. The proposed restrictions recognise the higher risks associated with such lending.” WWW.PROPERTYINVESTOR.CO.NZ // NZ PROPERTY INVESTOR 15

ASK AN EXPERT OUR EXPERTS 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 property-related transactions, valuation and restructure services, and tax planning. Withers Tsang & Co Phone 09 376 8860, www.wt.co.nz

RON HOY FONG

As a successful property investor and mentor, Ron has built an impressive portfolio and a wealth of investment strategies and experience. Contact Ron today on 021 888 298 or ronhoyfong@gmail.com

BERNARD PARKER

Bernard is principal of Quinovic – Kapiti-Mana. Quinovic’s outstanding people and systems provide the most professional, eﬀective and reliable residential property management service in the NZ market for over 26 years. www.quinovic.co.nz

KRISTER SAMUEL

Krister specialises in selling high yielding apartments for Ray White. www.rwcityapartments.co.nz

RECOVERING COSTS FOR TENANT DAMAGE

Does a new insurance decision mean a landlord can’t recover costs for deliberate tenant damage? My tenant has moved out and left the carpet very dirty and covered in cigarette burns. It needs to be replaced. The tenant also broke every single blind in the house. The tenancy adjudicator has asked me to provide my insurance details for the Tenancy Tribunal hearing where I will seek damages from the tenant. I suspect the adjudicator is looking to use the Osaki decision to allow the tenant to walk away from my claim. My policy is a standard policy with excess on each claim and I’m told each room is a claim. Owing to that excess and each damage item being a new claim I can’t economically claim repairs from my insurance. The total damage is in excess of $3,000, but each event is not more than the excess. The Osaki decision is about a peril - a house fire - but can a cigarette burn and broken blinds be a peril? Can I claim? You are correct that the referee at the Tenancy Tribunal is likely to follow the Holler vs Osaki decision and not allow recovery from the tenant. In terms of response under your insurance cover, you may seek to have the claim considered under malicious damage. You should also raise the argument that the various damage occurred on one occasion (such as during a party) if this can be substantiated. Failing this, I would advise you to try to negotiate the application of minimal excesses with your insurer. - Myles Noble

MYLES NOBLE

Myles is head of claims and earthquake response for Crombie Lockwood. He also holds various advisory board positions in the insurance industry.

ALLAN GALLOWAY

National Manager Case Management at Ministry of Business, Innovation and Employment

NZ PROPERTY INVESTOR

AUGUST 2016

Sell or hold? My wife and I are in our early 40s. We own a three-bedroom home in Queenstown. We have around $145,000 left on the mortgage and approximately $450,000 of equity valued by the bank on the property. Homes similar to ours in the immediate area are selling for $850,000. We have a very large section which we are adding a two-bedroom rental on to shortly in order to increase equity and provide income. District plan changes are set to allow us to subdivide the section in two to three years. This could mean the two-bedroom rental is part of a separate title. We could possibly get three to four other titles on the section. We are mid to low income earners and will mostly have our equity to work with on the larger part. Potentially, we can see more land becoming available around the time that the district plan is approved. This could mean more supply and less demand, which could drop the value of our only asset. Would you suggest getting the best price now and going mortgage free or holding? Queenstown does tend to be quite boom/bust in the way its cycles operate, so timing is worth taking into consideration. If what you are saying is correct then you should have closer to $700,000 of equity – that being the $850,000 mark you say similar properties are selling for minus your debt

Do you have a burning property investment question you need an answer for? Whether you are just starting out in property investment, or an experienced investor, visit www.landlords.co.nz and click on Ask an Expert to have your questions answered.

and the carpets are left reasonably clean and tidy, that should be sufficient. - Bernard Parker

Taxing ﬂatmates vs boarders level. As you already own the land you should run different models to see which option will work best for you. One option is establishing if you can just complete the build for the additional dwelling and leave the subdivision. This would assist from a servicing point of view, but would limit the equity growth. Compare this option against the option of completing the subdivision - which would increase your equity levels further, but would be unlikely to assist from a cash flow point of view. You should then extrapolate these scenarios out further depending on how many sections you could potentially cut the property into and also what level of risk you are willing to take on. - Kris Pedersen

Evicting dodgy tenant I have a tenancy that's off to a bad start. It’s two weeks in and only a bond has been paid – no rent. A third week of rent is due tomorrow. Meanwhile, neighbours are complaining about extra fences going up, security cameras being added, black polythene being put up in the windows and two snarling dogs in the back yard. Not a good look! I have a 14-day notice to remedy served re the rent owing. But I have not yet inspected the property since I would be concerned for my safety. What is the best way to move toward eviction? I have alerted the Police and Animal Control. Unfortunately, the tenant has a 12 month fixed term agreement. I aim to get to this to the Tribunal as soon as possible. Under the Residential Tenancies Act, where a tenant is in breach of their responsibilities under the tenancy agreement (eg: the rent is in arrears), landlords can serve the tenant with 14 days’ written notice requiring the tenant to remedy the breaches, as you have indicated you have done. If the tenant does

not comply with the notice, if the tenant is utilising the premises for any unlawful purpose, or at any time if the tenant is at least 21 days’ in arrears, the landlord can apply to the Tenancy Tribunal to resolve the matter. This may include seeking an order terminating the tenancy. If you do not feel safe conducting an inspection, you may wish to follow-up any concerns with the Police and Animal Control to establish any wrong doing, or anything that would be considered a breach of the tenant’s responsibilities under the Act. - Allan Galloway

Carpet cleaning pressure I am a tenant and am moving house with the same property management company. While I am quite happy having the carpets professionally cleaned at the end of my tenancy, the property manager is insisting I use his recommended company. It is more expensive than the company I would like to use and my choice is used by several other property managers in the area. He will also not accept use of a portable carpet cleaner – only the $110,000 machine that his preferred company uses. The carpets are not dirty as such. But we do have two cats so I am happy to have carpets cleaned. But where do I stand if, on inspection, I produce proof of cleaning and he will not accept it and insists I have them cleaned again or have the cost of extra cleaning deducted from my bond? Cleaning of carpets at the end of tenancy is a difficult issue. On one hand, you have a couple of cats and you have agreed to have the carpets cleaned because of that fact. On the other hand, the Residential Tenancies Act requires that you leave the property “reasonably clean and reasonably tidy”. But there is no requirement for you to accept the landlord’s preferred carpet cleaner. As long as your carpet cleaner does a good job,

My 19-year-old University student daughter is buying a property and plans to rent out the second bedroom. I have read that if she does this she doesn't have to pay tax if the person pays less than $254 per week. We anticipate the rent for the second bedroom to be $230. Does this also apply if her trust buys the property for her – ie: if the property is in her trust’s name? Your question relates to boarders and flatmates. There is a difference between a boarder and a flatmate. Essentially, you feed a boarder while you just share space with a flatmate. The weekly standard cost calculation you refer to only relates to boarders, not flatmates. For flatmates you use normal rules: rental income less allowable costs even with one flatmate. For boarders you have a choice of two methods: actual cost (similar to flatmates) or standard cost. The standard cost method has two components: weekly standard cost and annual capital cost. The weekly standard cost changes each year. In 2016, the weekly standard cost is $257. If the boarder is paying less than this there is nothing to declare and no loss to claim. If your income is over the weekly standard cost you must then apply the annual capital standard cost. This involves formulae based on using your home to provide boarding services. Where the property is owned by a trust things differ again. This is because the IRD consider the person to be providing the boarder services your daughter, not the trustees of the trust. The first component of the boarder calculation is the same – ie: determine if the rent earned is less than the weekly standard cost. If it is, you are done. If it isn't, you need to apply the annual capital component. But, in this situation, you can only use the rent your daughter pays to the trust in the calculation. - Mark Withers

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A Christchurch couple saw a need for pet-friendly accommodation post-earthquake â&#x20AC;&#x201C; but they didnâ&#x20AC;&#x2122;t predict the resulting rapid growth of their property portfolio, writes Vicki Holder

Successful property investor and mentor Ron Hoy Fong has built an impressive portfolio and has a wealth of investment strategies and wisdom to share with you. For information about his mentoring programs call Ron today on 021 888 298 or ronhoyfong@gmail.com 20 NZ PROPERTY INVESTOR // AUGUST 2016

PROFILE: BLAIR ANDERSON & NATALIE PERZYLO

WHEN CHRISTCHURCH PROPERTY investor Blair Anderson talks about “the big hairy problem” he’s not referring to his dog. This problem, says the dog trainer and behaviourist, reaches across whole cities. It’s about the ongoing failure to recognise the crucial social role animals and pets play in our lives. The fact few others have cottoned on to this glaring niche opportunity has been significantly advantageous for Anderson and his partner Natalie Perzylo. It’s enabled them to grow their pet-friendly property portfolio in Christchurch over the past three years, rapidly and with ease, from one to 14 income streams. In the process, they have become passionate advocates for more sustainable thinking around pet friendliness in our cities.

How it started Anderson and Perzylo became aware of the lack of pet-friendly properties when thousands of pet owners across Christchurch were forced from their homes after the earthquakes struck and pet owners struggled to find temporary accommodation: most landlords simply don’t like tenants with pets. The pair heard heart-wrenching stories from pet owners who had had to deal with the trauma of leaving their homes and also found themselves in the unbearable situation of not being able to take their pets with them.

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In this hot Auckland market beware the free taxi driver advice. More often free advice will turn out to be the most expensive advice when your investment turns to custard. Get professional advice from an experienced and successful investor who will help you to achieve your goals.www.ronovationz.com. Ron Hoy Fong www.ronovationz.com WWW.PROPERTYINVESTOR.CO.NZ

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PROFILE: BLAIR ANDERSON & NATALIE PERZYLO

“I spoke to a guy on a plane who said he was leaving Christchurch to live in Auckland. He admitted with guilt he had had to euthanase his best friend that morning. No-one could take his dog. That was the kind of pressure on people.” Pet lovers themselves, Anderson and Perzylo run a website called Doglinks.co.nz which has helpful advice for pet owners. They were keen to help out pet owners and by chance, the earthquakes put them in a position to do so. 22

NZ PROPERTY INVESTOR

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Between zones For several years before the earthquakes they had toyed with the idea of buying an investment property, but never quite got there. Their first purchase just across the street from where they lived in Wainoni Rd came about when they were in limbo between the red zone and green zone, waiting to hear from the Canterbury Earthquake Recovery Authority (CERA) on whether their own property would be acquired by the State.

As they were waiting and time was marching on, they decided to rent the property a three-bedroom home with granny flat. So they furnished the dual-income property (which they bought for $400,000) and rented it out, like a motel service to pet-owning families – earning an impressive $1800 a week. That sounds high – but it was set high to balance the uncertain duration of occupancy – part and parcel of this type of tenancy and

THESE PEOPLE OWNED THEIR OWN HOUSES. THERE WERE NONE OF THE USUAL CROSS-CHECKS AND TENANCY CHECKS NEEDED. THEY WERE CLIENTS OF INSURANCE COMPANIES THAT NEEDED TEMPORARY ACCOMMODATION – BLAIR ANDERSON garage, and made improvements, converting it into a studio. Again they furnished it for temporary accommodation. With their healthy cashflow they were soon able to buy a three-bedroom home in New Brighton. Anderson and Perzylo continued to add to their portfolio, advertising fully-furnished properties on the Post Earthquake Tenancy Services website, which linked to their own site www.holmesforrent.co.nz. Their strategy was buying easy do-ups in areas with strong demand from people repairing houses. “People didn’t want to shift far from schools and they wanted to bring their dogs. It wasn’t the usual landlord/ tenant scenario,” Anderson says. “These people owned their own houses. There were none of the usual cross-checks and tenancy checks needed. They were clients of insurance companies that needed temporary accommodation.” Many were prepared to pay extra to secure a place for their pet.

Pets’ important role

Blair Anderson and Natalie Perzylo have been able to help many pet owners through their specialist accommodation.

unique to the Christchurch market at that time.

Opportunity presents Needless to say, the bank manager was happy. Anderson and Perzylo quickly saw an opportunity to provide further accommodation to distressed homeowners who had to leave their homes – and were heavily subsidised by (CERA) and the Christchurch Council. They soon acquired another property, a

One tenant thanked Anderson for having him and his dog. He said: “If it wasn’t for my dog, I would have jumped off Whitewash Head.” During the earthquakes, Anderson says, that was a common thread. Pets played an important social role, largely unrecognised by authorities – and landlords. All Anderson and Perzylo’s properties at that time were short-term rentals and were furnished like motel rooms, which gave significant cashflow leverage, plus a significant tax write down on the bulk of the material purchased to provide the high standard required by insurers. “Insurers made it delightfully easy,” Anderson says. But it wasn’t all plain sailing. Every acquisition had its idiosyncrasies. “Some were tidy. Some proved problematic. Many involved complex scenarios where insurance money was transferred with the sale allocated to reflect the cost of the repair. Some came with up to

$80,000 cash accompanying the purchase, which made it easier to get a mortgage on the day, but it had to be kept on the books as a liability because it was unspent. You had to make sure the money was not considered accessible income for tax purposes.” Some still have unresolved issues and Anderson says he can’t sell them, but they’re still earning a good rental, “because we’re dog friendly.”

Pet beneﬁts Anderson says it’s difficult to determine how much extra their properties earn through allowing pets, but explains there are intrinsic benefits. “When you advertise, you have people queuing up and you get to pick quality tenants and they think you’re great landlords,” he says. “They are more compliant. Dog-friendliness means we have good tenants who work with us or empathise with us in constructive ways. “Our property business is profitable. We’re significantly cashflow positive with close to a 10% yield. That’s a good return in this market.” But pet friendliness is not just about them, Anderson says. “We’ve leveraged off this with a modest property investment portfolio. We’ve learned there are multi-million dollar dividends confronting pet friendly investors where there is densification.” Anderson believes pet-friendly buildings sell for more, quicker. “It’s a vertical marketing strategy that creates better cashflow for investors – for those who have pets already or would like the option of a dog. This is not recognised."

No pets rule He cites a couple who moved into a Gold Coast apartment tower with their small dog as an example of changing attitudes. Several years after purchasing the apartment, the body corporate held a meeting and decided on a nopet rule – owners didn’t have to get rid of their pets, they just couldn’t replace them. The couple were not happy as they believed this devalued their apartment and asked for a judicial review. The judge found that based on evidence received from valuers and real estate agents – the value of the property on an open market was reduced by 10%. He found in favour of the couple: the decision to establish a no-pet rule was in conflict with the best interests of the owners. “This is a time of changing paradigms,” says Anderson.

Change needed Perzylo is originally from Canada so Blair and Natalie travel there often. As dog

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PROFILE: BLAIR ANDERSON & NATALIE PERZYLO

The pet-loving pair are taking lessons from cities around the globe that facilitate pet-friendly living.

owners, they have taken an interest in how Canadians are tackling pet-ownership in densely populated areas. Toronto is an example of a city with a high strata title fabric, a city reflective of a dense urban situation with less dependence on cars and where people are tenants for life,” Perzylo says. “We’ve learned from this city, there are significant benefits to be had from an investor and developer perspective if they resolved the problem of providing for pets.” Anderson says the city encourages petownership in apartments by including dog washing areas and indoor recreational areas for dogs in winter. There’s a lesson, Anderson says, for places like Christchurch. “Christchurch has taken 10,000 families and put them on sections the

24 NZ PROPERTY INVESTOR // AUGUST 2016

WE ARE JUST A SMALL INVESTOR THAT HAS GROWN FROM OWNING A HOUSE ACROSS THE ROAD TO HAVING A PORTFOLIO OF 14 INCOME PROPERTIES AND WE HAVEN’T HAD TO INCREASE OUR EXPOSURE ONE BIT. – BLAIR ANDERSON

size of postage stamps and not considered what that meant. I’m dealing with people who say: ‘It’s not the same for our dog’.” Anderson is adamant landlords can get better yields by including pet friendly design – and that will make the bank manager happy too. “We are just a small investor that has grown from owning a house across the road to having a portfolio of 14 income properties and we haven’t had to increase our exposure one bit. We still have the same gearing ratio as when we started and we’re healthier than ever because of capital gains and a bank manager who will bleed all over the floor for us. Petfriendliness is good business.” The pair will continue growing their petfriendly portfolio and support pet-friendly initiatives in Christchurch.

BALANCING ACT: HOW TO HANDLE HOUSING MARKET Jenny Keown asks industry leaders where we are in the property cycle and how to strategize for changes in the market.

NZ PROPERTY INVESTOR

AUGUST 2016

LEAD STORY PROPERTY CYCLES IS THE PROPERTY CYCLE PEAKING? It’s hard to avoid the hype, hyperbole and anxiety of the property boom. Whether you’re a frustrated first-home buyer, a renter, or a property investor – everybody is watching the Great Housing Spectacle – like a magnificent multidimensional, coloured rocket soaring to dizzyingly, unchartered heights. Yet the fuel propelling all of this is potent and potentially explosive. Surging migration, housing supply restrictions, low interest rates, aggressive bank lending, and access to cheap money. The Reserve Bank's latest macroprudential measure - 40% equity requirement for investor lending nationwide - brings yet more uncertainty to an already unsettled market. Most economists don’t believe this equals an impending crash – yet are agreed a downturn in prices to varying degrees is coming between 2017 and 2020. Financial advisers are urging caution to investors to check their portfolios to make sure that if in the event of a 10% to 15% drop they will have enough cash-flow on which to live.

HOUSE PRICES IMPACT Milford Asset Management’s Brian Gaynor says housing bulls should keep a close eye on the rising housing supply figures. “Supply is now increasing and any reduction in immigration and/or bank lending is likely to have a dramatic impact on house prices,” Gaynor says. Consents have picked up dramatically and it won’t be long before the annual consents exceed 30,000. In the four years to 2012, an average of only 14, 850 consents annually were issued compared with 26, 218 consents in the four years to 2008. He says he doesn’t know whether there will be a crash, but says there will be a downturn, probably between 2017 and 2019.

NO IMPENDING CRASH Property Institute of New Zealand chief executive Ashley Church isn’t of the view that there is a horror price spiral on its way. “When Auckland does peak, it will do what Auckland markets always do and taper off 5%,” Church says. Mr Church says the RBNZ’s LVR announcement would make little difference to house price inflation. “Many investors will already have close to, or over, 40% equity and this will be little more than a slight speed bump." The last ‘crash’ was the 1970s, and it’s very unlikely that the market will crash based on empirical data going back 30 years, Church says.

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LEAD STORY PROPERTY CYCLES

Auckland houses are close to being fully valued, says Michael Gordan.

Kiwis behave differently to other markets in downturns. “We tend to wrap our arms around ourselves, rather than panic and rush out and sell. The banks have changed and are much more careful to let people hold on to property even if they have negative equity,” he says. Church is concerned, however, about a dive occurring in regional New Zealand, in areas without strong drivers of growth such as population growth. He thinks a dramatic change in migration figures could be the catalyst for a price drop – whether that is a pick up in the Australian economy, and a drop in Australians coming here, or rise in New Zealanders going to Australia. Church urges investors to make sure they are not sensitive in their portfolio, as a change in interest rates could upturn them.

LOW GROWTH ON HORIZON Westpac’s acting chief economist Michael Gordan says they expect the official cash rate 28

NZ PROPERTY INVESTOR

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WHEN AUCKLAND DOES PEAK, IT WILL DO WHAT AUCKLAND MARKETS ALWAYS DO AND TAPER OFF 5% - ASHLEY CHURCH

to be cut once more this year, and then that’s it. “There is limited room for fixed term mortgages to fall from here… the Reserve Bank is becoming concerned to the degree they are inflaming the market,” Gordan says. The economy is past its peak growth, driven by high dairy prices and the Christchurch rebuild; the rebuild has plateaued and will move to its wind-down phase, he says. “We expect below average growth from 2018 onwards. It’s not on the immediate horizon. We have population growth, construction outside Christchurch is on the ramp-up side and tourism is doing reasonably well,” he says. Auckland houses are pretty close to fully valued, Gordan says, but this is not the case in some regions. Strategic Risk Analysis managing director Rodney Dickens says this current cycle has run longer than a number of past cycles, and

Lisa Dudson recommends investors "stress test" their borrowing.

CONSERVATIVE: BRANDON LIPMAN looks like it will be protracted because of the way monetary policy is handled. “Signs are emerging in the labour market that interest rates are too low, confirming what the housing market has been saying for some time,” Dickens says. The biggest threat to an upturn in prices is the tightening labour market, he says. The June BNZ confidence survey showed that employers are finding it difficult to source skilled staff, especially construction and engineering. “In my assessment Governor Wheeler will let the labour market tighten too much causing a mini wage-price spiral just as Bollard allowed to occur last decade, meaning more than token OCR hikes will be required to fight it (i.e., enough to eventually end the upside in prices),” Dickens says. The bank economists, like the Reserve Bank, are acting oblivious to what is happening at the coal face of the labour market, which was exactly the same last

decade, in that none of them predicted the 13 OCR hikes Bollard delivered between 2004 and 2008 says Dickens.

NO END TO PRICE RISES Barfoot & Thompson’s Peter Thompson says subject to a major government initiative or Reserve Bank change, the current cycle will continue for years. He says the new increasing of equity requirements will have some impact but will also put pressure on rents. He did say, however, that the Auckland Unitary Plan could impact the property cycle. The leafy inner suburbs of Auckland could be rezoned for more intensive housing under the plan. A panel is providing its full recommendations on the proposed plan to the Auckland Council by July 22 this year and the council must notify its decision on whether it rejects or accepts them in part or full, by August 19 this year.

Brandon Lipman is young, ambitious and keen to make money from property investing – but he’s keeping cool in the current climate. The 24-year old university graduate owns a property in Hamilton, and is about to build on the same site, and is looking for a third property in Hamilton or Lower Hutt. His investment strategy is buy and hold: invest for the long term – yields, and capital gains are a bonus. “I’m conservative, and so are a lot of the people I associate with,” Lipman says. If investors are after the gains we have seen in the last few years, they are not going to get them in the next three years, he believes, although “nothing is impossible”. Lipman bought the $270,000, threebedroom, 1970s Hamilton rental property last April, after getting a deposit of $45,000 together through working late nights at Countdown supermarket while he was studying towards a commerce and science degree. The property is on a 800 sqm site, where he is going to build a 65sqm, two-bedroom house in a few weeks. “Property always has to be a long term gain in a rising market. I foresaw that Hamilton was going to have a price rise,” he says.

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AGGRESSIVE: MIKE HARBOTT

In 2002, Mike Harbott was mentored by a veteran property investor on how to build a property portfolio. He bought three houses in his first year out of school; the first house was a $30,000 mortgagee sale in Gisborne. “We quickly found tenants and had it revalued, and used it to buy another house,” Harbott says. After this initial foray into property investing, Harbott spent nearly 10 years trying to initiate a start-up digital business. During the time he went through the digital accelerator programme at Lightning Lab, and learnt invaluable lessons about how business worked. In 2013, he came back to property investing and went in on a student rental in Dunedin, with his brother. Since then he has bought four student rentals and four residential houses worth $4 million in partnership with friends. “I always do joint ventures with friends – it’s more fun and profitable,” he says. Harbott, who now has a team of five people, classes himself as an “incredibly aggressive” investor. He plans on buying 20 more properties in the next 18 months, and isn’t fazed by the spectre of a property downturn. The Dunedin market is really buoyant, Harbott says, with low listing numbers, and an increase in sales, and prices. He believes the market has risen $50,000 over the last six months. “Auckland will pop eventually, but even if it does, Dunedin will keep (rising in value). “If I can soldier on growing the portfolio, and when the Dunedin market falls – I have good relationships with investors who have a lot of faith in me and can write blank cheques for me to pick up bargains,” he says with a laugh. Harbott says he has his investment method and strict criteria the house has to meet. “We sit below 20% LVR, and always have surplus cash for unforeseen circumstances,” he says.

NZ PROPERTY INVESTOR

AUGUST 2016

GROWTH NOT SUSTAINABLE CoreLogic's Nick Goodall says it is difficult to quantify the housing situation, yet he believes the strong price growth is not sustainable. Auckland has become an international city, and the demographic make-up of Auckland is far different than what it used to be, and with that brings different expectations around living standards. At the moment, Auckland’s apartments make up 7% of properties, compared with 28% in Sydney. The Auckland Unitary Plan could be quite interesting and will go some way to slow things down. “It requires a change in mind-set, in that for a major international city, you can’t get a quarter-acre within 10 minutes of the city,” he says. Lisa Dudson, owner of Property Ladder,

which sources properties for investors, says she isn’t one to talk about the market, but is concerned about practical matters. “I tend to focus on what clients can do to manage a potential downfall,” Dudson says. “Can you afford it? Does the deal work? Does it look like a good investment opportunity? Have you considered risk minimisation factors?” It’s prudent to consider what happens if your property’s value goes down by 10% to 20% and what that does to your personal financial situation, she says. “Do you have enough cash-flow to ride that through for 12 months?” she says. Dickens says investors should look mainly outside of Auckland, and if investing in Auckland, use more equity to avoid the negative impact of higher interest rates on cash flow.

THE PROPERTY CYCLE

In general, property cycles follow a similar trajectory – a period of moderate to high growth over a few years, followed by a downturn brought about by particular market conditions. According to the Reserve Bank of New Zealand, New Zealand has had six price upswings since 1965. Auckland reportedly experienced a housing bubble between 2003-2007, which ended with the Global Financial Crisis. Real house prices in New Zealand jumped 77% in the mid-2000s, according to the Reserve Bank. The second largest upswing occurred in the high inﬂation era of the early 1970s, with house prices jumping 53%.

RECESSION, NOT A CRASH

To date, the current cycle is more modest. Since mid-2012, house prices have jumped 52% in Auckland, and only 11% in the rest of the country. Strategic Risk Analysis managing director Rodney Dickens says that house prices fell 12% in the 2008/09 recession, which isn’t technically a crash. “What tends to happen in recessions is the number of sales “crash” and prices can fall signiﬁcantly but not crash like share prices can crash, and fall 40-50%,” he says. What has the Reserve Bank interested about this current cycle is the extent of the house price rise in Auckland compared with the rest of the country.

DIVERGENT HOUSE PRICES

Since mid-2012, house prices have jumped 52% in Auckland, but only 11% in the rest of New Zealand. “Regional variation in house price inﬂation is not unusual, but the extent of the current divergence between house prices in Auckland and the rest of the country is unprecedented,” according to a Reserve Bank bulletin. It isn’t clear how steep that trend should be, whether it is time-varying, or whether it will persist, says the Reserve Bank.

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FEATURE THE BLOCK

HOW TO ACHIEVE TOP DOLLAR: LESSONS FROM THE BLOCK

The Block season five saw five ex-leaky homes transformed into a cool, urban community of houses looking to fetch top dollar at auction this month. Joanna Jefferies discovers how you can apply key lessons to your next renovattion.

Dyls and Dylz' kitchen was well received by the judges.

AS ANOTHER AUCTION DAY LOOMS, the Block season five contestants wait with baited breath. Have they maximised their layout? Will their styling be well received by buyers? Who will achieve the highest price above reserve and the $100,000 in prize money? This season’s theme of ‘girls against boys’ saw four teams of friends transform five leaky homes in the East Auckland suburb of St Johns/Meadowbank. For the first time, we saw tradies as contestants, with Tauranga builders Dylz & Dyls appearing to have the advantage. But Wellington corporates Sam and Emmett, Dunedin ladies Courtney and Emma and forensic research scientist and stylist duo Niki and Tiff appeared to make up for the short fall with excellent design, staging and project management skills. Block host and ex-Black Cap Mark Richardson says each year there are key similarities between the teams that take home the win. “Everyone who’s done well on the Block, their ability to project manage has been on an equal footing with their ability to style,” Richardson says. “It comes down to managing cash, not going over budget, which means you can keep your reserve price at the auction as low as possible.”

Sam and Emmett's guest room was a far cry from their initial eﬀort in the Block's ﬁfth house - which featured bright blue walls.

BUYING A LIFESTYLE Co-host and Your Home and Garden magazine editor Shelley Ferguson agrees and says there are two different scenarios in which contestants have achieved the highest profit at auction. “The first is somebody delivering a house that is really, really creative and very high-end in design,” Ferguson says. She cites season three’s Alex and Corban as proponents of the bespoke styling solutions that achieved this look.

“There is a pocket of buyers with money who are prepared to buy into that look and that lifestyle.” The second approach, she says, is a more neutral one and appeals to a broader range of buyers. “The other home that tends to do well, is a more versatile and neutral, open-plan look.” Season two winners Alice and Caleb espoused this look, she says. “They had a muted palette, with timber details and I think that appeals to Kiwis. They can imagine moving straight in.”

HOT MARKET Bayley’s Victoria Bidwell, a judge in season one who returns regularly to advise contestants on creating homes that appeal to the market, says the success of neutral homes with quality fixtures, renovated to a high-standard, can be applied across the ‘hot’ central Auckland market. She says high-end renovators are making great gains in the current Auckland market, spending big dollars to bring out-of-date dwellings up to a modern standard that appeals to cashedup buyers.

Fiona McLeod’s Top Design Tips: Renovating to Sell ♦ Creating storage space is crucial. ♦ Open up interior spaces to create ﬂow. ♦ Install quality kitchen appliances – they can sell a home.

♦ Attention to detail: don’t forget the small things like styling.

♦ Perfect paint work is essential. ♦ Clean Up! No-one likes clutter. ♦ Indoor-outdoor ﬂow is crucial for Kiwis. ♦ Tidy up the garden and outdoor areas for sale.

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FEATURE THE BLOCK

Emma and Courtney's kid's bedroom featured a plywood headboard.

EVERYONE WHO’S DONE WELL ON THE BLOCK, THEIR ABILITY TO PROJECT MANAGE HAS BEEN ON AN EQUAL FOOTING WITH THEIR ABILITY TO STYLE – MARK RICHARDSON

Niki and Tiﬀ's bathroom took out the win due to its soothing palette and range of textures.

"[High-end do-ups] have got to be in a great location and have proximity to good schools. The whole house needs to be done to a really high standard... landscaping, the whole thing."

DESIGN IT RIGHT Judge Fiona McLeod says the design principles are always the same when trying to achieve a high-end look on a budget – with scale and layout the top priorities. “It’s very much about the layout and the flow – you don’t want to walk into the back of a sofa, for example.” “You want buyers to feel good in the space. By creating a harmonious colour palette and good flow in terms of layout, you get that nice feeling – you feel good in the space, but you don’t necessarily know why. Another essential part of renovating is drawing a layout plan before buying key pieces, says McLeod. Ticking off the three ‘S’s when reconfiguring or designing a layout is vital. “Storage, scale and space-planning are key.” She says so many problems – such as Sam and Emmett’s door hitting the oversized vanity in their master en suite – can be spared, simply by running through layout options before committing to a design. She also warns that it is a different game renovating for yourself, as opposed to renovating to create profit; neutrals are the best way to reach a broad market of buyers. But neutral doesn’t have to mean boring. “Using materials and textures can create a point of difference, rather than using a bold colour,” she says. 34 NZ PROPERTY INVESTOR // AUGUST 2016

Fellow judge and architect Paul Izzard agrees and points out that it’s vitally important the social aspect of how an occupant – or family of occupants – might use a space, and this needs to be integrated into the design from the get-go. “Good space planning from the start is essential and those sociable elements need to be recognised – the whole social aspect is really important.”

STYLE IT UP Interior spaces look a lot smaller without furniture in them, McLeod says, and for this reason she believes home-staging is a winner for vendors. “Furniture helps buyers imagine the scale of their own furniture in the space,” she says. “But when it comes to the more detailed

styling, it serves a different purpose. It makes the space more beautiful and inviting for a buyer… It encourages them to get more emotional about their purchase.” Richardson says this season’s houses are going to be “incredibly high-performing” in terms of sustainability and eco-features. “Everything to do with them is going to be top-notch. It will be interesting to see if that grabs buyers’ imaginations.” Victoria Bidwell believes the ‘hot’ Auckland market should prove profitable for the contestants, and that the fully-renovated houses will be popular with time-poor working parents and overseas buyers who may feel nervous about taking on any kind of renovation. Modern families prefer 'done-up' houses, she says.

Q&A HOT TIPS FROM THE CONTESTANTS Amy Hamilton Chadwick speaks to the season ﬁve Block contestants and discovers four sets of friends who’ve transformed from DIY and design rookies to renovation experts.

EMMA AND COURTNEY

EMMA AND COURTNEY What was the biggest DIY lesson you learned during your time on The Block?

NIKI AND TIFF

money into the structure of the house, so we couldn’t spend thousands on accessories. You have to be a bit of a bargain hunter. We won the [magazine cover styling] challenge when we had a lot of options and we could grab whatever we wanted, which proves that it’s quite a lot easier on a big budget.

Emma: Probably time management. It’s not a physical skill, but you need time management, you need confidence and you need to back yourself. Court and I have got better and better at painting – we've got a routine and we know how to get it done.

Did you start with a design scheme before you arrived on the Block or ﬁgure it out as you went along?

Emma: We went in with a plan of what we wanted: quite neutral to appeal to all types of buyers. But we also had to wing it each week. It depended on what we felt the room needed.

How do you decide what to buy when faced with a shop full of homewares?

Courtney: I’ve already got a list, so I grab what’s on my list. If you go in blind, there’s too much time wasted. What was your best moment on The Block?

Emma: Our best moment was when Court and I won the plank challenge. And obviously completing the house – you think, 'Holy s…t, we did that.’ It doesn’t feel like we did do it! And the worst moment?

What were some of the challenges of working to a tight budget?

Courtney: Because we didn’t win a lot we had to suffer in some areas. We always put

Courtney: Probably week four. We just started to hit a wall; emotion starts to take over and you make bad decisions. What we're doing is the impossible.

NIKI AND TIFF Your team has been highly successful at creating an expensive look without spending too much – how have you managed that?

Tiff: It’s been portrayed that I have expensive taste, but I think I have good taste! Part of my job is sourcing products and I go to wholesalers directly and get prices. So I have more expensive items and better quality products at a trade price. I’m also really good at mixing expensive with op shop; I think about structure and texture. The skills I have are quite important because I can style properly. I can turn a $5 scarf into a table runner.

What’s the most useful practical skill you've picked up?

Niki: All the skills! We've had to pick up painting really quickly – you need to do a quality job from the start, you can't blame anyone else for a poor paint job. For me it's been about trying to anticipate the next move, seeing where the builders were at and what I could do to help them get to the next step faster.

WWW.PROPERTYINVESTOR.CO.NZ // NZ PROPERTY INVESTOR 35

Where do you get your style ideas?

Tiff: I’m an interior design book junkie, and I look online at wholesalers, at Instagram, at things from photoshoots that take my fancy. Then I look at [the supplier's] whole website. For my job I go to a lot of op shops; it's not necessarily going to malls because then you'll find the same things as everyone else. What's been your favourite challenge?

Niki: I really loved the breakout challenge; that was fun, and also dinner wars – hanging out with our friends and relaxing with all the contestants. The challenge where we got to make a room for foster kids was really, really special. On the video we got to watch their reactions and that was really grounding for us.

Sam and Emmett What has been your main concern with the design?

Emmett: You need to pick a style and have cohesion so everything you do fits well and the house flows. There are constraints; you're trying to win rooms but also trying to make your house cohesive. We did our research in advance and knew our direction, but until you see the spaces it's not definite.

What new skills have you learned on the Block?

Sam: I knew absolutely nothing when I came onto the show, so everything I've done I've picked up – gibbing, painting, insulation. If you gave us a bedroom now we'd be able to do it all that.

SAM AND EMMETT What's one piece of advice you'd give to someone doing their own renovations?

Are you planning to take your new skills and put them to use in the property market?

Emmett: Negotiating skills – everything's

Sam: We were looking for homes for six

moveable. It helps to have brand behind you, but if you find something you love, don't sacrifice on quality in order to achieve the result you're after. We're rapt with our house, it’s the sexiest house with the most chilledout vibe. It reflects us well and what we'd like in a home: high end, corporate, sexy, chilled out.

months before we started on the show [but found nothing] which was totally the reason we applied. We're keen to look at some houses afterwards. The Wellington market is about to go off. We’ve been looking in Petone, which has been undervalued for so long. I also think Newlands is really, really undervalued – you get a lot for your money and you're not far away at all.

DYLS AND DYLZ Dyls and Dylz What’s been the toughest part of the experience?

Dyls: It’s been a pressure cooker. You've got to stop and smell the roses, enjoy what you’re doing, and realise that you’re lucky to be where you are and have the opportunity.

Shopping for your interior can be stressful – what tips have you learned?

Dylz: Not to buy the first thing you see in the store. We had to be really picky about how we dressed it up. There’s a lot of expensive stuff out there. Me and Dyl, we have a plan on Monday, because without one you won’t finish on time. Then sometimes we wing it quite a lot; that’s how we do things. It all comes together in the end.

Dyls and Dylz' bathroom was criticized by the judges for using too many contrasting styles.

WWW.PROPERTYINVESTOR.CO.NZ // NZ PROPERTY INVESTOR 37

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RENOVATION: ROOFING

RAISE THE Amy Hamilton Chadwick ямБnds out why roof maintenance should be high on your priority list.

40 NZ PROPERTY INVESTOR // AUGUST 2016

THE ROOF OF YOUR PROPERTY IS LIKE the hair on the back of your head: you don’t look at it very often and you tend to assume it’s doing its job, looking good and keeping you warm. Any news to the contrary often comes as a nasty surprise. But luckily, you can easily repair or replace any bald patches in your roof, and with the right maintenance it will last a lifetime. Most types of roofing should be cleaned every three years, whether with a light chemical treatment or a low-pressure water-blasting, says Christine Black at Kowhai Roof Coating’s head office. Metal and concrete tile roofs will need recoating around every 12 years.

MAINTAINING YOUR ROOF

Follow those directions and you should never need to replace your roof, Black says. But ignore your roof and you’ll start to see problems arise between years 10 and 15. If you then restore your roof it might cost you around $7,000, but continue to ignore it and the cost of reroofing will be at least $30,000. The main problem areas for various roof types, Black says, are: • Disintegrating concrete tiles – left unsealed these will break down to something like sand. They need to be cleaned, sealed and coated. • Metal roof tiles – the top coat will erode over time due to moss and lichen, which can eventually lead to rusted tiles with holes. • Pointing – the weathertight seal where your roof ridge is bonded to the rest of the roof. If that breaks away it can lead to leaks; this can be hard to spot. Guttering is another leading cause of preventable roofing problems. Overflowing gutters, especially in a valley-style roof, or combined with an undersized drainpipe, can quickly lead to leaks. Gutters can sag, crack and degrade, but are relatively cheap to repair. When it rains, look for water running directly down from the gutters; full gutters and downpipes can block your drains, allow water into your walls and rot your boards.

DOING ROOF REPAIRS YOURSELF A lot of roofing work is restricted and must be completed by a licensed building practitioner who is specifically licensed in roofing work. You may be able to undertake minor repairs to your roof, like replacing tiles or reattaching guttering, but you need to know what you are doing and have appropriate safety equipment.

WWW.PROPERTYINVESTOR.CO.NZ // NZ PROPERTY INVESTOR 41

RENOVATION: ROOFING

Older tiled roofs can be problematic when attempting to repair as tiles can break when walked on.

Metal roofs need washing at least every three years.

Falls from roofs and ladders account for 70% of falls in construction, according to Worksafe. Far better than doing it yourself is hiring an expert and roofing repairs are relatively inexpensive. The average cost of a roofing job posted on BuildersCrack.co.nz is $660 and each month around 250 roofing jobs, mainly repairs, are posted, says co-founder Jeremy Wyn-Harris.

42 NZ PROPERTY INVESTOR // AUGUST 2016

IF YOU’VE GOT A GOOD ROOF NOW, LOOK AFTER IT! – CHRISTINE BLACK He says you can spot a pattern of more roofing repairs being required in coastal areas, particularly in Wellington, as well as in Invercargill which posts more than double

the average proportion of roofing jobs. It’s a reminder that the more your roof is exposed to the elements, the more care and attention it will require. A good relationship with a roofing company is a must, says investor and property trader Rachel Ward. Before she buys a property she always ensures the roof is in good condition, though she has had to reroof a few properties over the years. She chooses

Roof red ﬂags Here are ﬁve warning signs that your roof may need repairing or replacing:

▶ Damp patches in the ceiling or exterior walls.

▶ Chips in your gutters. When the coating is coming off your roofing material and gathering in the gutters, this is a definite red flag.

Any sign of damp coming into the house needs to be investigated immediately.

▶ Light visible from inside the roof space – if light can get in, so can rain, damp air and mould. ▶ Your roof is over 25 years old and you’ve never maintained it.

▶ The roof is sagging – this is typically a structural problem. Your roof may need bracing (and so will you when you get the invoice).

Information, resources long run metal roofing for its low-cost, low-maintenance qualities. This is the most popular material in New Zealand, but if you are re-roofing, there is a wide range of options to consider.

METAL

Long run (or long line) metal roofing is made from steel, coated with a zinc-aluminium alloy. Suitable for virtually any type of roof, comes in a wide range of colour choices and can be easily repainted; it’s also lightweight and simple to install. Metal roofing is generally the most affordable choice, starting from around $60 per square metre with low installation costs.

METAL TILES (AKA DECRAMASTIC TILES)

These are made in a similar way to long run roofing, from alloy-coated pressed steel, and come in an equally wide range of colours. There are also a number of texture and shape options for a high degree of customisation. Metal tiles start from around $55 per square metre, though it takes longer to install than a long run metal roof.

CONCRETE OR CLAY TILES

Supremely durable, concrete or clay tiles keep their colour and wear well in almost any location. They also provide a breathable thermal mass on the roof that boosts heat retention in

the house, as well as absorbing noise to give a quieter environment. But they do weigh more, so expect to spend more on trusses and installation than for a long run metal roof. You’ll also need to check regularly for moss or lichen growth. Concrete tiles start at around $60 per square metre; clay from $120 per square metre.

MEMBRANE

When you have a flat or curving roof, a membrane roofing system is the best choice to ensure complete weather-tightness. It’s a lightweight option and easy to repair, with prices starting from around $100 per metre.

ASPHALT SHINGLES

An increasingly popular roofing choice in New Zealand, asphalt shingles are made by applying modified asphalt to a fibreglass mat base. They come in a range of colours and are around $65 per square meter. Quality brands carry a long-life warranty and an algae-resistant coating can be applied before installation. Asphalt shingles are lowmaintenance and attractive, though only suitable for a sloping roof.

BIG BUDGET OPTIONS

Several other fantastic high-performance materials are available, but none are really cost-effective for a rental property. Timber shingles start at around $160 per square meter and look really attractive. They provide

The ﬁrst step for any job is to do your research. Here are a few suggestions to get you started:

▶ Building.govt.nz provides a list of restricted building work and advice for choosing a building practitioner.

▶ The Roofing Association (roofingassn. org.nz) provides a database of specialist roofing contractors and information about the trade. For an estimated price range on your roof repair or replacement, try the BuildersCrack estimator.

▶ Failing to look after your roof is certainly a false economy. Include it in your regular rental maintenance costs and it will continue to look good and protect your property for decades to come. “If you’ve got a good roof now, look after it!” Black says. “It will last forever and a day.”

great insulation, are sustainable, long-lasting and can be painted or stained. Slate tiles look gorgeous, weigh a ton and will last for literally hundreds of years if well cared for; prices start from about $300 per square metre. Copper tiles start at around $250 per square metres and are beautiful, malleable and resistant to all kinds of corrosion. Copper is also highly likely to be stolen off your rental, as it can be sold for around $6 per kilogram as scrap – the same reason copper downpipes and hot water cylinders so often go missing.

WWW.PROPERTYINVESTOR.CO.NZ

// NZ PROPERTY INVESTOR

COLUMNS

YOUR BANKER JEREMY STAPLETON PROPERTY INVESTORS WHO ARE HIGHLY GEARED MAY SEE THEIR OPTIONS NARROWED UNDER THE NEW LVR RESTRICTIONS – JEREMY STAPLETON

BLANKET LVRS CHANGE CLIMATE Jeremy Stapleton outlines the Reserve Bank’s new proposal for 60% LVRs for investors across New Zealand. PROPERTY INVESTORS COULD be forgiven for feeling a bit unloved with both the Government and the Reserve Bank of New Zealand continuing to look at the role of investors in the housing market. Prior to the Reserve Bank’s July 7 speech on housing market risks to financial stability, Prime Minister John Key went on public record urging the central bank to consider the role of property investors. What Mr Key had in mind was the Reserve Bank’s loan-to-valuation (LVR) restrictions, which presently require a higher LVR for mortgage lending on investment property in Auckland (30% minimum equity) than for the rest of New Zealand (20% minimum). In the July speech, Housing risks require a broad policy response, Reserve Bank deputy governor Grant Spencer stated, “The Reserve Bank is mandated to promote the soundness and efficiency of the financial system.” “Our concern is that a severe housing correction would pose real risks for financial system stability and the broader economy.” Mr Spencer had to concede that low interest rates were partly responsible for the property boom, and of course the Reserve Bank effectively sets short term rates. A cluster of reasons was blamed for housing inflation beyond the central bank’s comfort zone. “On the demand side, the key drivers are population growth and easy credit,” stated Mr Spencer. “The low cost of credit is making higher debt levels affordable, particularly for investors who can deduct interest costs from taxable income.” “Residential investors are accounting for an increasing share of house sales and new mortgage credit.” The Reserve Bank subsequently responded to cheaper credit and Mr Key’s prompting about property investors by issuing a consultation paper

Ask Jeremy: Email your questions about property investing to Jeremy_Stapleton@bnz.co.nz

Jeremy Stapleton is a Sales Manager for Property Investment at Bank of New Zealand and heads up a team of property investment managers who specialise in residential property investment. Visit bnz.co.nz/propertyinvestment or phone 0800 269 009 to find out more. This article is intended as a general discussion only and is based on selective information which may not be suitable for your purposes. BNZ strongly recommends the recipients take independent legal and taxation advice prior to making any investment decision. The views expressed are the writers own and do not necessarily represent those of BNZ or its related entities.

NZ PROPERTY INVESTOR

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on July 19 proposing changes to LVRs effective from September 1, hinting that banks should start complying before then. Under the proposed new rules, the following restrictions would apply: 1. Lending to residential property investors across New Zealand would be permitted with an LVR of 60 percent (i.e. a deposit of 40 percent). 2. No more than 10 percent of lending to owneroccupiers across New Zealand would be permitted with an LVR of greater than 80 percent (i.e. a deposit of less than 20 percent). 3. Loans that are exempt from the existing LVR restrictions, including loans to construct new dwellings, would continue to be exempt. These rules abolish the previous LVR differences between Auckland and the rest of the country. The rules also preserve the distinction between existing properties, to which LVR restrictions apply, and new dwellings, which are exempt. Property investors who are highly geared may see their options narrowed under the new LVR restrictions. By contrast, investors who are well-established with substantial equity may not notice much difference in the way they operate. The Reserve Bank has also signalled that it is reviewing bank capital in relation to investor lending and it is possible that this will increase the costs of funding investor lending.

COLUMNS

YOUR ACCOUNTANT MARK WITHERS

THE RISE AND RISE OF AIR BNB Mark Withers reveals the tax consequences of renting out your property as holiday accommodation. THE DISRUPTIVE TECHNOLOGY of Air BnB is beginning to have a profound impact on the way we book accommodation and let space. Landlords are starting in ever-increasing numbers to look at the opportunities to rent furnished accommodation on a casual basis at rates that generate a higher overall income despite vacancy rates than what could be achieved with a permanent rental. In that respect they are competing with traditional providers of commercial accommodation, hotels, motels and boarding houses. There are some tax consequences to this type of activity though.

GST REGISTERED OR NOT? Firstly, the impact of GST must be considered. The provision of residential accommodation in a dwelling is specifically excluded from being a taxable activity for GST. This is why residential landlords are not GST registered, but the exclusion is about the nature of the activity, not the nature of a dwelling. Those providing accommodation in “commercial dwellings” are subject to GST. Where the accommodation is provided to someone on a short term basis without a tenancy agreement, in accommodation that is not their habitual place of abode, this would generally be considered within the boundaries of a taxable activity for GST. However, where the turnover from this activity is less than $60,000, GST registration is voluntary. But consider the situation with a family trust already GST registered as a result of owning a commercial building. If short term casual income is then generated from a dwelling this property also will need to be considered with respect to GST. Before you start thinking this might land you a GST refund, understand that the rules around claiming GST have now changed after a change of

use to allow GST only to be recovered on a drip feed formulae based on how long the property has been in a taxable activity verses how long it has been owned overall. It’s also only recoverable on cost subject to a few other ifs and buts. If at the point our property enters the GST arena it has already increased significantly in value from its original cost the change of use could expose our gain to 15% GST.

ISSUES TO CONSIDER Landlords also experimenting with short-term letting and adding dwellings to this activity need to project forward their likely turnover. As soon as you are on track to turn $60,000 from the activity overall you lose the option to remain unregistered. Other tax issues include the potential impact of the mixed use asset rules where the property owner is enjoying personal use of the property when it is not let to guests. These rules allow for deductions of mixed use costs only in the ration of booked nights to total nights occupied, for example, no deduction for the vacant but available nights. There is also a ring fencing provision for losses if gross rent does not exceed 2% of the CV of the property. Even renting of a single room to boarders or flatmates has tax consequences. Details of this are in the IRD publication Consider also that short term accommodation will also require you to furnish the property and provide power, phone and Wi-Fi. Assets purchased for this purpose are depreciable and the extra utility and marketing costs are deductible. Consider carefully your insurance issues. This type of activity does alter your risk profile, tell your insurer. Remember those ‘P’ cooks are wealthy guys; they are just as likely to rent your multimillion dollar beachfront home to cook their meth as they are an industrial unit in the back of beyond. WWW.PROPERTYINVESTOR.CO.NZ

REMEMBER THOSE ‘P’ COOKS ARE WEALTHY GUYS, THEY ARE JUST AS LIKELY TO RENT YOUR MULTIMILLION DOLLAR BEACHFRONT HOME TO COOK THEIR METH AS THEY ARE AN INDUSTRIAL UNIT IN THE BACK OF BEYOND – MARK WITHERS

Mark Withers is a partner of accountancy firm Withers Tsang & Co.

// NZ PROPERTY INVESTOR

COLUMNS

YOUR PROPERTY COACH SUE IRONS

CASH FLOW IS KING …OR IS IT? PROPERTY INVESTMENT IS FIRST AND FOREMOST ABOUT GETTING THE FINANCE RIGHT, WITHOUT THAT, NOTHING ELSE IS GOING TO BE SUCCESSFUL – SUE IRONS

Sue Irons uncovers the true reason that prevents investors from buying more property. THE THREE LIMITATIONS FOR investors that I see over and over again are: ▶ Time ▶ Skill set ▶ Risk appetite. And most investors I meet are limited by more than one of these factors. “Cash flow is king” is a frequently-heard saying, especially in relation to property investment. We could add to that “you won’t go broke making a profit” and “if you look after the pennies, the pounds will follow”. But is this really true? Certainly having a cash flow positive property is, on the face of it, appealing. The other side of the coin, however, is if this is at the cost of capital growth, then is the cash flow in fact a red herring and the lesser result of the two? I want to go deeper because it is not lack of cash flow that stops the average investor in their buying tracks, but rather the lack of servicing. The term “servicing” is related to how the banks calculate the potential lending and they use entirely different figures than the actual interest rate. At the time of writing this article one of our main lenders in New Zealand has set their servicing rate at 7.65%, which is 3.3% above the actual interest rate. Plus, to add insult to injury, they then also assume a principal and interest repayment schedule as opposed to interest only, which effectively turns even the most cash flow positive property, into a fairly ugly result. More importantly, they also apply this same formula to your total lending, including loans at other banks, so your apparently strong income and ability to service debt can be decimated very quickly!

Sue is the Head of Education and Director of Postive Real Estate (NZ) Ltd and also one of NZ's leading experts with a diverse knowledge of all aspects of property investing. Sue spent the last 15 + years immersed in the property market. Sue speaks at and runs many property events and has mentored many of New Zealand’s leading investors. Sue works with her investing clients to assist them to grow and enhance their portfolios, whilst keeping her eye on their end goal - financial freedom and choice. sue.irons@ positiverealestate.co.nz

YOUR EXPERT TEAM So, what’s my point? Firstly, that all banks are not created equal and that as part of your investment 46

NZ PROPERTY INVESTOR

AUGUST 2016

strategy, having your finance managed by an investment lending expert is going to make a massive difference to your ability to grow your portfolio. To quote Richard Tirendi, “If you’re the smartest one in the room, you’re in the wrong room”. If we look at that from an investment point of view, your success will be supported by the quality of your team. Obviously that includes an investmentfocused mortgage adviser, and the same thinking applies to your accountant, solicitor and strategist. Property is not one-size-fits-all and having your finance managed in the most efficient and effective manner is the first step to success. Just this week I met with two clients, who were in theory “preapproved” to a certain figure. It was immediately clear, however, that the results they had were at best “lazy lending”. With a quick chat to our finance adviser and some initial analysis, both clients were in the position to more than double their buying power.

GET IT RIGHT Property investment is first and foremost about getting the finance right, without that, nothing else is going to be successful. Positive Real Estate works closely with finance advisers who specialise in investment lending. If you couple that with a personally tailored investment strategy, it is no surprise that our clients are forging ahead with their plans and achieving their goals, with ease and confidence in their team. If you would like to meet with one of our coaches to see who we can help you, then please contact me at sue.irons@positiverealestate.co.nz or come along to one of our monthly Property Investment Seminars, which we run in Auckland, Tauranga, Hamilton, Wellington, Christchurch and Queenstown each month.

COLUMNS

YOUR APARTMENT AARON TUNSTALL

NEW BUILDS HEAT UP New build apartments look like fantastic buying right now, says Aaron Tunstall. WHAT COULD BE SMARTER or more appealing than a brand spanking new apartment? Thanks to a shifting market and completely overhauled lending rules, right now, buying an apartment off the plans looks like an excellent investment. Apartments, unlike one-of-a-kind houses, can be easily compared by a per-metre-square price. Look at the cost of buying existing ‘old stock’ apartments in central Auckland right now: it’s above $10,000 per square metre. For instance, we just sold a small apartment built in 2005 for $13,000/m2. You can buy a brand new apartment off the plans for between $12,000 and $14,000/m2, with lower body corporate fees, less maintenance – and tenants flock towards new apartments. The building will be constructed under current design and building regulations, which is a massive advantage, too. Given the new lending environment, which is pushing borrowers towards new builds, as well as the way banks are feeling much friendlier towards apartments than they ever have, I don’t know why you would buy second-hand at the moment. So what should you look for when you’re buying off the plans? You might be surprised to hear that there are opportunities to spot a bargain. Get in early for your pick of the bunch – if you have a good look you might find something that’s a bit better than its price would indicate. For instance, if all the one-bed apartments on level eight are identically priced, but you can get one with a hint of a sea view, you could fetch a winner.

WINNER IN THEORY The trick is to know what you’re buying. It’s not always easy to tell when you’re only looking at pieces of paper, but you need to get a feel for the outlook of the apartment, who’s buying in the building, whether the view or light can be built out and where the sun’s going to be. On that note, it’s worth remembering that while a northfacing property is always theoretically a winner, apartments can have serious overheating problems; sometimes south-facing is actually an advantage.

Because you’re at the planning stage, you might be lucky enough to be able to get the developer to include a ventilation or air conditioning unit into your apartment when it’s built. (It’s next to impossible to do it afterwards.) The best apartment buildings are often those with plenty of owner-occupiers living in them. If you can afford to buy in one, they are usually extremely well maintained and managed, allowing you to attract and keep the best types of tenants. Do some research on the developer, too, but remember that if the company goes bust, your deposit is held safely in a solicitor’s trust account. In addition to the advantages of a new apartment, the finances really stack up in a rising market. Investors can put down a 10% deposit and see that lump sum turn into some serious profits by the time the key is handed over two years later or thereabouts. In fact, some investors have been making superb returns this way in recent years.

INVESTORS CAN PUT DOWN A 10% DEPOSIT AND SEE THAT LUMP SUM TURN INTO SOME SERIOUS PROFITS BY THE TIME THE KEY IS HANDED OVER TWO YEARS LATER - AARON TUNSTALL

APARTMENTS ONSOLD For example, two large apartment buildings that have recently been completed, Urba Residences and Queens Residences, came onto the market around two years ago. The apartments were then selling for $8,500 to $9,000/m2, with a 50m2 one-bedroom apartment going for about $450,000. Now they’re selling for between $10,000 and $12,000/m2, so the same one-bedroom apartment will now fetch $550,000. No wonder 25% of the apartments had been onsold before they even settled. It’s important to remember that this strategy requires a rising market – in a falling market that $45,000 could have turned into nothing, or worse. However, the returns on central Auckland apartments remain the best yields in the city. Rents on those Urba and Queens buildings have risen by 10% to 15% over what they were predicted to be when originally sold. Buying and on-selling is a strategy that requires foresight, courage, and a certain appetite for risk. But with returns still good and rents continuing to grow, I believe the greater investment is holding onto your new apartment and enjoying the rent. WWW.PROPERTYINVESTOR.CO.NZ

Aaron Tunstall is the general manager of award-winning Impression Real Estate, which specialises in property management and sales and manages over 1,750 Auckland apartments.

// NZ PROPERTY INVESTOR

COLUMNS

YOUR PROPERTY FINDER CAMPBELL VENNING

NEW RESTRICTIONS FOR INVESTORS Campbell Venning explains why new LVR changes are good for investors. SECOND-HAND PROPERTY BEING PURCHASED FOR INVESTMENT PURPOSES WILL HAVE FAR LESS COMPETITION THAN IT DID PRIOR TO THESE RULES - CAMPBELL VENNING

THE BIGGEST CHANGE we have seen since 2010 when depreciation on buildings was revoked - has just hit the residential investment market. The Reserve Bank of New Zealand (RBNZ) have put their largest set of brakes on investors in an attempt to curb an over-heated property market. If you want to buy an existing property or one that is more than 30% of the way through construction, you will need to put in 40% of the purchase price versus 20% under the old rules. That’s twice the capital, regardless of price or location. If you are buying an apartment, townhouse or house off-theplans, your deposit remains at 20% as this category of property is exempt from the new rules. So what does this mean for investors? If you are a large investor with a decent sized balance sheet, it will probably mean nothing. If you are a first, second or third time investor it has huge implications for what you can and can’t buy. The RBNZ desperately wants this change – they’re very concerned about the housing bubble bursting. They can’t stop demand but focusing buyers toward new stock in an under-supplied market is a smart move. Investors create new housing for a growing rental pool and typically with new builds and offthe-plan purchasing, pricing is less volatile because developers release set price lists versus tendering or auctioning. The laws of supply and demand still rule but typically price increases are more palatable than the annual increases of 25-30% that we have been seeing in locations such as Auckland, Tauranga and Hamilton. This sort of growth isn’t sustainable over the long-term and the Government has said ‘enough’. Affordability and house prices are growing further apart. Banks have stress-tested the amount of loan defaults that would occur if interest rates jumped to

Contact: Campbell@ thepropertyfactory.co.nz

NZ PROPERTY INVESTOR

AUGUST 2016

7% and it’s not a pretty picture! They are looking at debt-to-income ratios and when first time investors are paying $600,000800,000 for a property that is only rented for $500 to $600 per week, they just don’t have enough income to afford it. Tenants can’t pay more rent because a landlord’s interest bill increases, so the borrower is left to fund the short-fall and the banks' forecasts show they can’t.

So what impact will this have? Second-hand property being purchased for investment purposes will have far less competition than it did prior to these rules. It’s a huge market so I see this having an impact overnight across New Zealand. New or existing investors with limited equity will only be able to afford off-the-plan or new builds meaning these two product categories are about to get an influx of buyers. So what does all this mean for smart investors? You do sensibility tests on debt-to-income ratios. You analyze a purchase with 6% or 7% interest levels. You stand back and ask yourself if $500,000 in Christchurch makes more sense than $800,000 in Auckland for the same rent per week. You get prudent with your purchasing and don’t get carried away with greed in locations that are growing at exponential rates. It doesn’t mean stop investing – there are still great deals to be had. You have to get ‘smarter’ with your investing and be sure the numbers make sense. Campbell Venning has been investing in property for over 20 years and is the Head of Property at The Property Factory. He can be contacted at campbell@ thepropertyfactory.co.nz or on 021 515 085

COLUMNS

YOUR PROPERTY MANAGER SARAH DAWSON

FUTURE OF PROPERTY INVESTMENT What does the future hold for property investment in New Zealand? Airbnb continues to disrupt, writes Sarah Dawson, but the real impact remains unclear. THE SECOND HALF OF 2016 continues to be a period of change in the New Zealand property market. How does foreign investment look in the wake of Brexit? Evolving technology, the reaction to Brexit and the continued disruption of Airbnb all present challenges and opportunities. With the New Zealand property market at an all-time high, how sustainable is this extended period of growth? Many are speculating that the property market will take a hit post-Brexit.

POST BREXIT JITTERS Any economic jitters may transfer to the New Zealand property market, not least because UK tourists to New Zealand are the fourth biggest national group to visit and are major investors in New Zealand residential, holiday, commercial and industrial property. While the weakened pound restricts spending power, the property market is robust with demand still far outpacing supply. New Zealand’s property market has been a safe haven for investors looking for reliable yields following the 2008 global crash, and uncertainty in the global markets is likely to further reinforce New Zealand’s property market as a safe bet. Any downturn on the back of Brexit is likely to be short-lived. Interest in New Zealand residential property spiked the week after Brexit, indicating a short term boost for the property market. It is believed to stem

from disgruntled “remainers” not wanting to live in a UK that is outside of the EU.

AIRBNB DISRUPTIVE UPSTART Airbnb continues to change the way we see the vacation rental market but the long term effects are still unclear. It is a fact that Airbnb reduces long term rental stock, but the question is to what extent? And does it push up prices for locals looking to rent? The reality is that nobody yet knows how many buy-to-let landlords are using Airbnb instead of renting out on long term contracts. Experts in New York say Airbnb has taken 10% of the residential rental market into the vacation rental market. Any comparable figures in New Zealand would further decrease supply and increase demand quite significantly. Good news for property managers, landlords and builders – not so great for those aiming to get onto the property ladder. With Airbnb making renting rooms out easier, the issue may be one of the rental market expanding, rather than Airbnb reducing supply of residential stock. Regardless, small property investors looking to enter the property market have upsides, as well as established vacation rental companies; the likes of Airbnb expand their potential client base enormously. As ever, with the advent of new paradigms come challenges and opportunities, and property managers must adapt to the evolving nature of the industry meaning that understanding the new booking channels (Airbnb, Homeaway, VRBO etc) is a must. WWW.PROPERTYINVESTOR.CO.NZ

NOBODY YET KNOWS HOW MANY BUY-TOLET LANDLORDS ARE USING AIRBNB INSTEAD OF RENTING OUT ON LONG TERM CONTRACTS – SARAH DAWSON

Sarah Dawson – Head of real estate sales, Rockend.

// NZ PROPERTY INVESTOR

STRENGTH IN THE

MANAWATU SHADOWS

Photos by: www.ManawatuNZ.co.nz

Palmerston North’s housing market has long been considered a slow, albeit solid investment option. But there can be strength in the shadows and the eternal student city makes an increasingly alluring option for investors, writes Miriam Bell. IT’S ALL TOO EASY TO OVERLOOK the quiet attractions of provincial centres for the bright lights of bigger cities. In the case of Palmerston North, a city best known for student life, this has long been the case. Yet it is the business hub of the Manawatu region, poised for economic growth and blessed with abundant natural charms. For investors, the city’s housing market has a reputation for being steady as she goes. Traditionally, it’s been a market for long-term investors interested in cash flow over capital gains. And, in recent years, Palmerston North’s market has remained flat while others have soared. But these days it would be a mistake for investors to overlook ‘Palmy’. In a sign of the times, the city’s market is now busier than industry veterans can remember. At the same time, it offers investors some attributes that are rare in more fevered markets around the country.

GROWTH DRIVERS Investor interest in the Palmerston North market has been hampered by regional economic factors in the past. Bar the tertiary education sector, it was assumed there was simply not that much going on in the wider economy. Palmerston North City Council economic policy advisor Peter Crawford says successive major industry closures, along with fallout from the GFC impacted on regional economic growth for many years. That is changing now in his view. “The region has been less affected by the decline in dairying due to strong returns in the sheep and beef sectors. Improving returns in agriculture has resulted in growth returning to many smaller rural communities. Population growth is now occurring in areas that were previously in decline.” There has also been growth in the region’s forestry and manufacturing sectors, while the city’s education and

REGIONAL REVIEW: PALMERSTON NORTH

research sectors are going from strength to strength. Crawford says Massey University is a key driver for the economy, particularly the research sector which includes Fonterra, AgResearch, Plant and Food and Landcare, and its future growth. “For example, Massey University’s strengths are an important element in the development of Food HQ. Major capital expenditure is planned for Food HQ and its partner organisations and significant growth in staff numbers is projected. AgResearch is also currently transferring more staff to Palmerston North.” Recruitment for cutting edge research facilities is one factor attracting more people to Palmerston North. But so too is the city’s affordable housing costs, compact layout and relaxed lifestyle options. Locals say that, given exorbitant housing costs and their runon effect elsewhere in the country, these factors are enticing growing numbers of people to move to the city.

REGIONAL REVIEW: PALMERSTON NORTH

There is currently good demand and low vacancies for rental property in Palmerston North.

Feilding is a popular rural town only a short drive from Palmerston North.

RISING PRICES As interest in Palmerston North as a lifestyle destination has grown, so too has activity and growth in the housing market. The latest REINZ data shows that Palmerston North’s median price hit $325,500 in June 2016. This was up 8% on May’s median price of $302,500 and up 12% on June 2015’s median price of $290,500. REINZ Manawatu region spokesperson Andy Stewart has worked in Palmerston North real estate for 28 years and says he can’t recall a more buoyant market than 52

NZ PROPERTY INVESTOR

AUGUST 2016

PROPERTIES ARE NOT STAYING VACANT FOR VERY LONG AND THEY ARE GOING AS LONG TERM TENANCIES. THERE ARE GOOD, SAFE RETURNS FOR LANDLORDS HERE. - WADE THOMPSON the current one. He says there is huge demand for property across the board, but a big shortage of listings. “In terms of inventory, about 130 to 150

houses are selling each month. But only 100 or so are coming on to the market a month. There are so few properties on the market that everything is selling and many properties are attracting multiple offers: there’s just not enough properties to meet demand.” Quotable Values (QV) latest data has the city’s average current value at $315,930 and its year-on-year price growth at 8.4%. QV’s Palmerston North registered valuer Chris Price says values have been growing steadily, but the growth has been at a sustainable level. “Palmerston North still has some

The central city is a popular location for student rentals.

INVESTOR ATTRACTIONS While there has been a significant pick-up in price growth, the median price also demonstrates the city’s affordability. Increasing demand might be pushing prices up, but Manawatu Property Investors’ Association president Pauline Beissel thinks there are still opportunities for investors. It’s a desirable place to live in, prices are affordable, and it is central to Hawkes Bay, Wellington, Taranaki, and Taupo which means it is well located for investors, she says. “There is a strong tenant pool. We are an education city where students require accommodation and there is good industry around us requiring housing.” For investors seeking cash flow, Palmerston North is a financially viable option, Beissel adds. “For example, Auckland investors think they are getting good returns here. And they are comparatively. It’s just that for long time local investors they are not as good as they have been in the past.” Recent Realestate.co.nz data for the Manawatu region suggests Palmerston North returns should indeed be attractive to investors. Based on its average asking price for the region, it calculates the Manawatu region’s theoretical average yield is 5%. This makes it New Zealand’s third best performing region for residential rental property investment. Further, there has been no let-up in rental demand. Absolute Rentals Property Management director Wade Thompson says the rental market is also busier than usual. “Properties are not staying vacant for very long and they are going as long term tenancies. There are good, safe returns for landlords here.” In his view, it’s a good time to purchase an investment property in Palmy if cash flow is the motivation. “With good property management, an investor can reap the rewards. An investor could get up to 6% yield on a property.”

RENTAL CONSIDERATIONS room for price growth compared to other similar centres like Hastings, Napier and New Plymouth so we expect to see some continued growth over the long term but this would likely be at or near the steady level currently being experienced.” There is investor interest in the current market due to the development of Palmerston North as a distribution hub for the central and southern North Island, he says. “But they don’t seem to be key players in the growth which is occurring. This is because the main drivers seem to be a lack of listings and the low cost of borrowing.”

Tales of overcrowded, devastated properties and raucous parties mean some investors might be wary of the student rental market the city is known for. But the reality is quite different. Strong demand for rentals extends far beyond students. Stewart says another strong rental market driver is the fact the city is a also a defence personnel hub. Linton and Ohakea training camps are both nearby and they equal about 1,100 people, who make up a solid part of the rental market. “Students are a strong component of the market and always will be, but the days of students being able to dictate the rental WWW.PROPERTYINVESTOR.CO.NZ // NZ PROPERTY INVESTOR 53

REGIONAL REVIEW: PALMERSTON NORTH

There are currently very low listings and high demand for housing stock.

The Manuatu is diversifying its industries and becoming an attractive proposition for investors.

market is over. They are more selective these days anyway, which means the standard of property has had to increase accordingly.” This means the city’s rental market has levelled out. There is now a wider range of tenants but they want higher quality properties. There is one constant though: property type. Apartments are not a part of the mix, there is very little call for smaller (one to two) bedroom houses and demand for five plus bedroom houses has dropped. It is threebedroom houses, followed by four-bedroom houses that are now most in demand. To maximise returns, Stewart recommends that would-be landlords buy three-bedroom houses and add value. There are a lot of good, solid threebedroom, ex-state houses round, he says. “If an investor brings them up to scratch in terms of new insulation requirements, which tenants want now, there is scope there to add value by doing that and putting in heating aids like double-glazing, for example. It makes the property more rentable and, down the track, more saleable.” 54

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BUT EVEN IN SUBURBS OFTEN CONSIDERED ‘BAD’, LIKE HIGHBURY, THERE ARE SOME GOOD PARTS. PEOPLE ARE OFTEN TOLD NOT TO BUY IN HIGHBURY, BUT THERE ARE SOME GOOD STREETS IN HIGHBURY. THERE ARE GOOD AREAS IN ALL AREAS. WITH THE LIMITED CHOICE AVAILABLE AT THE MOMENT, IT IS NECESSARY TO DO YOUR DUE DILIGENCE THOROUGHLY IN ORDER TO GET GOOD DEALS IN THESE AREAS - ANDY STEWART AREA OPTIONS Pinning down where to buy in Palmerston North is not straightforward. This is

because there are no stand-out good areas or bad areas for investors – in terms of either capital growth or rental returns. For example, Price says recent QV data indicates there are no suburbs which stand out above the rest in terms of appreciation. Meanwhile, in Stewart’s view, the shortage of listings means investors simply can’t be too choosy when selecting suburbs to buy in. There are pockets of areas in suburbs which are not that good to buy in, he says. “But even in suburbs often considered ‘bad’, like Highbury, there are some good parts. People are often told not to buy in Highbury, but there are some good streets in Highbury. There are good areas in all areas. With the limited choice available at the moment, it is necessary to do your due diligence thoroughly in order to get good deals in these areas.” Thompson agrees that no one area of the city is better for investors. However, he picks Kelvin Grove as a good area for investor properties. “It has lots of newish, four-bed family houses with double garages. They are

Palmerston North: the key drivers ▶ According to Statistics NZ, Palmerston North’s population was 85,500 as at June 2015. It is estimated the city’s population will be 98,800 by 2043. ▶ The latest data shows that Palmerston North accounted for 2.3% of jobs nationally. But that is increasing: the number of jobs in the city was up by 1.3% on the previous year. ▶ Palmerston North’s major industries include health care and social assistance; public

administration and safety; research, education (including tertiary) and agribusiness. These are all economic growth areas, but the research and tertiary education sectors are booming. ▶ Significant projects in the works for the city include potential infrastructure investment of up to $250 million by Food HQ partners; sizeable infrastructure investment from MidCentral DHB on its base hospital in Palmerston North; and Bupa’s plans to build a new

retirement village. ▶ The government is expected to announce major investment decisions relating to Accelerate 25 – its Manawatū-Whanganui growth plan - in August. Accelerate 25 aims to boost economic growth in the region. ▶ Affordable housing costs in both the city and the wider region are proving increasingly attractive. According to REINZ, Palmerston North’s median house price was $325,500 as at June 2016.

The area is known for its picturesque walking and mountain biking tracks.

good, solid, low maintenance. They are very popular with tenants because they offer a relaxed lifestyle.” Traditionally, Roslyn, Takaro, Awapuni, and Kelvin Grove have been considered good for returns. But Beissel says returns depend more on the property than the area. “No one is fussing over areas at the moment. They are grabbing what they can get. There are no rules at the moment! It’s just a very active market.” In her view, Hokowhitu, Clover Lee,

Summer Hill are desirable areas to buy in. She has been investing in the region for 32 years and says she will buy anywhere – but most of her investing has been in Hokowhitu. “It’s quite a nice area. So prices are more expensive but capital gains have been greater.”

LOOKING FORWARD While Palmerston North property might currently be going gangbusters, on its own terms, the big question for investors is likely to be around the market’s future prospects.

To this end, locals say it pays to remember the city offers stability and security. Stewart says he doesn’t see any change to the market pattern for at least 12 months. “We are seeing price growth, but our prices are not skyrocketing at the rate of other cities. The Palmerston North market is more stable and its price growth more sustainable. We don’t have the highs and lows of others places. But Palmerston North is a reliable place to buy and invest.”

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REGIONAL REVIEW: INVERCARGILL

CoreLogic NICK GOODALL, SENIOR RESEARCH ANALYST

MARKET COMPOSITION

RENT AND YIELD Median weekly rent ranges from $300 to $340 in eight of the nine areas detailed. The outlier from this is Hokowhitu West and Lagoon where the median rent is $380. Median value has a greater relative range – between $242k and $336k - again with the one exception of Hokowhitu West and Lagoon ($429k). Gross yield for the more expensive Hokowhitu West and Lagoon area is the lowest in the region at 4.6%, while the lower value areas of Highbury/Westbrook and Awapuni North and West register a gross yield of 6.4%. Annual change in rent has varied across the region with Awapuni North and West seeing a 7.6% decline and Kelvin Grove/ Roslyn a 10% increase. Both Highbury/ Westbrook and Takaro/Cloverlea/Milson saw no change in rent over the last year.

TAKARO/CLOVERLEA/MILSON

TERRACE END/HOKOWHITU EAST TERRACE END/HOKOWHITU EAST

PALMERSTON NORTH CENTRAL PALMERSTON NORTH CENTRAL

TAKARO/CLOVERLEA/MILSON

MASSEY/LINTON/ASHHURST MASSEY/LINTON/ASHHURST

KELVIN GROVE/ROSLYN

HOKOWHITU WEST AND LAGOON HOKOWHITU WEST AND LAGOON

KELVIN GROVE/ROSLYN

HIGHBURY/WESTBROOK HIGHBURY/WESTBROOK

HOSPITAL/PAPAEOIA

AWAPUNI SOUTH /WESTEND AWAPUNI SOUTH /WESTEND

HOSPITAL/PAPAEOIA

AWAPUNI NORTH AND WEST

APARTMENTS

HOUSE SIZE, BY BEDROOM COUNT In terms of size of houses, three-bedroom houses are the most common in the Palmerston North rental market. This is the case across the country. The relatively few houses that are in both Palmerston North Central and Highbury/ Westbrook are all three bedrooms, while the more populous areas of Kelvin Grove/Roslyn, Takaro/Cloverlea/Milson and Terrace End/ Hokowhitu East have a varied range of sized houses. Terrace End/Hokowhitu East is also the only area to register houses with five or more bedrooms, while Hokowhitu West and Lagoon is the only area with less than 50% threebedroom houses – the balance shared between two-bedroom (28%) and four-bedroom houses (25%)

HOUSES FLATS

MARKET COMPOSITION

AWAPUNI NORTH AND WEST

The rental market in Palmerston North is made up of predominantly houses throughout most of the city. Highbury/Westbrook and Terrace End/Hokowhitu East are made up exclusively of houses, while Hospital/Papaeoia and Palmerston North Central are the only two regions with less than 50% houses. Hospital/Papaeoia being dominated by flats while Palmerston North Central also has over 50% flats and is the only area with apartments.

RENTAL YIELD SUBURB

MEDIAN WEEKLY RENT

MEDIAN VALUE

GROSS YIELD

ANNUAL RENT CHANGE

Highbury/Westbrook

$300

$242,900

6.4%

0.0%

Massey/Linton/Ashhurst

$300

$304,100

5.1%

7.1%

Takaro/Cloverlea/Milson

$310

$281,550

5.7%

0.0%

Hospital/Papaeoia

$330

$336,350

5.1%

-0.6%

Kelvin Grove/Roslyn

$330

$282,200

6.1%

10.0%

Awapuni North and West

$305

$248,550

6.4%

-7.6%

Awapuni South/Westend

$315

$301,450

5.4%

-1.6%

Terrace End/Hokowhitu East

$340

$320,150

5.5%

3.0%

Hokowhitu West and Lagoon

$380

$428,800

4.6%

5.6%

Median Rent: Weekly rent based on the bonds lodged for three bedroom houses in the three months to June 2016 Rent Growth: The percentage change in rent compared to 12 months prior Median value:The median value of houses in the area based on estimating the current market value of each property using our E-Valuer GrossYield: Annualised median rent as a percentage of median house value. Note Palmerston North Central is excluded from this analysis as there are not enough 3 bedroom houses to create a reliable median value for the area.

Rental data is sourced from the Ministry of Building Innovation and Employment (formerly the Department of Building and Housing) based on rental bonds lodged.This rental data is supplied to us 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 house 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 house value calculated using our E-Valuer.

FEILDING With a population of about 14,000 Feilding is increasingly popular with families looking for the village and rural lifestyle. Many people commute to Palmerston North to work and live in Feilding. A picturesque town centre with boutique shops and cafes. Feilding is generally more aﬀordable than its big brother with average rents for a three-bedroom property around $320pw.

HOSPITAL/PAPAEOIA Strong demand as it’s close to Boys’ High School, the city and to the hospital with two bedroom units and ﬂats appealing to singles or couples working close by. In the last six months over 60% of properties rented were two bedrooms or less. Some wonderful prewar property in leafy streets.

CENTRAL CITY

HIGHBURY/ WESTBROOK Lower income suburb with a mixed reputation – can provide better returns as property prices are more aﬀordable. Average rents for a threebedroom property are approximately $275pw, a four- bedroom property is around $345pw.

Hugely popular with tenants - a drop in student numbers has made landlords raise their game by improving properties to secure good tenants. Mainly student housing, but a large number of units and ﬂats attract singles or couples. A lot of ﬁxed term tenancies are based around the university year.

HOKOWHITU Palmerston North’s most desirable neighbourhood with a strong demand for rental properties and good potential for capital gains. This fashionable village is very popular and is zoned for both PNBHS and PNGHS, with a selection of great cafes and is also by the oldest golf course in New Zealand.

AWAPUNI/WEST END Middle to lower income suburb with predominantly three-bedroom 1950s housing. Close to the city, student houses are converted into four or ﬁve bedroom ﬂats. A popular suburb with average rents for a three bedroom house around $330pw, a four bedroom property will be around $350pw. Could be a great place to invest with talk of a major inland port development outside the city in Longburn.

SUMMERHILL Relatively new and close to Massey University across the river from the city with great views of the Tararua’s and the city. Modern housing attracts middle to higher income families. Many four-bedroom homes often rented to Massey University employees. Further development is taking place as the city expands with some lifestyle property.

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NZPIF FROM THE EXECUTIVE OFFICER’S DESK ANDREW KING

TOUGH TIMES FOR INVESTORS Anti-landlord rhetoric is strong in this cycle, says Andrew King, but investors should be proud to provide the service they do. IT IS SHOCKING HOW PERFECTLY NORMAL STATISTICS, SUCH AS THE PERCENTAGE OF INVESTORS BUYING PROPERTY, ARE BEING USED TO MAKE A CASE AGAINST US AND FUEL THE NEGATIVE SENTIMENT - ANDREW KING

Andrew King, Executive Officer NZ Property Investors’ Federation

I WAS EXPECTING THIS YEAR to be relatively quiet on the advocacy front, but oh boy, how wrong I was. The last few months have been extraordinary, with a huge level of uninformed opinion blaming rental property investors for increasing house prices, tenants are no longer responsible for damage they accidently or even carelessly cause, the meth issue is exploding and Labour announced they are targeting speculators but instead their policies were aimed at rental property providers. To be honest, I'm feeling pretty worn out and I imagine I'm not the only one. Before a media interview I was talking to a cameraman who had recently sold his rental property. This was just before the Minimum Standards were due to come into effect, but he said that was just one of the reasons for selling. A point he made was that people had such a negative attitude to rental property owners that it made him feel uncomfortable. This was quite incredible to hear. It isn't as if he is selling drugs outside schools or investing in companies selling cigarettes, weapons or using child slave labour. He is (or was) providing people with somewhere to live. But in some people's eyes this makes him a monster. He is getting wealthy off the misery of others, forcing them to live in squalid conditions and pay exorbitant rents, just itching to kick them out in the snow if they miss one rental payment. He is depriving the young of getting a home of their own and forcing them into a lifetime of renting. He is causing interest rates to be too high and hurting our economy and he probably had a

THANK YOU FOR THE CONTINUING SUPPORT FROM NZPIF SPONSORS

hand in getting Trump in line to be President. People have never liked property price increases, but it is hard to know why the anti-rental property rhetoric is so strong this time around. This is the fourth property cycle I have experienced and every time there are cries that the young will never be able to afford a home of their own. Fortunately, I was unaware of these sentiments in the early 80s when I was part of the “young” and so saved for a home deposit and got a second job to pay the mortgage once I did buy a property. Back then, well meaning people were trying to help me and my young peers by pointing out our plight, but now I'm firmly part of the problem. It is shocking how perfectly normal statistics, such as the percentage of investors buying property, are being used to make a case against us and fuel the negative sentiment. Opinions are treated as facts. So many people have said investors are out-bidding first home buyers and pushing up house prices that it is now considered a fact. However, CoreLogic data shows first home buyers on average pay more for properties than investors. The Property Investors' Federation is working hard to provide a voice for our industry in the media. We have had meetings with the Insurance Council, The Tenancy Tribunal, government departments and MPs. Along with the Independent Property Managers Association we are on the NZ Standards Meth Committee. I'll be providing information in this monthly column on what is being achieved in that regard, but in the mean time don't forget that we provide people with homes to live in. Without us the number of tenants living in overcrowded properties, garages and cars will increase. We should be proud of what we do.

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NZPIF: AROUND THE REGIONS

NORTHLAND

AUCKLAND

WAIKATO

NEXT MEETING: Wednesday August 31, 7.pm at Distinction Whangarei, 7 Riverside Dr. Whangarei. MEMBERSHIP: $180 single or $210 couple; includes subscription to the NZ Property Investor and NZPIF discount card, plus local trade discounts. Please email npiacontact@gmail.com for more information. PO Box 1640, Whangarei.

NEXT MEETING: Tuesday, August 9,

NEXT MEETING: Wednesday, August 10, 7pm for 7.30pm start.The Pavilion of the HamiltonWorkingmen’s Club, Commerce St, Frankton, Hamilton. TOPIC: Come and beneﬁt from the expertise and experience in the room. The August event promises to be a daring, messy, energetic and a challenging time of authentic participation and learning. Back due to popular demand, we will again be hosting without an agenda using the ‘Open SpaceTechnology’. You will set the agenda and we’ll talk about what matters most to you. Bring property related issues and topics you are passionate about and might be willing to discuss. Come and enjoy the rational madness and be opened to discussions, inquiry and learnings. Light supper served and cash bar available. Members complimentary, Guests $40.00 / pax Guest registrations essential. MEMBERSHIP: $245 for single and $325 for joint memberships. Includes subscription to the NZ Property Investor, plus NZPIF and local discounts. Ph 07 838 9201 or email admin@waikatopia.org.nz for more information or write to P O Box 4346, Hamilton 3247.

INDEPENDENT PROPERTY MANAGERS’ ASSOCIATION The IPMA welcomes independentlyoperating property management industry professionals. Contact our admin team for details on joining. www.ipma.org.nz

NZ PROPERTY INVESTOR

AUGUST 2016

DorothyWinstone Centre, Auckland Girls Grammar School, 14 Howe St, Freemans Bay. Admission closes at 7.30pm. Free for APIA members and $75 for non-members with prior registration. TOPIC: Looking to the future: NZ economic outlook and housing market update - ANZ Senior Economist Sharon Zöllner reviews and projects key trends of the New Zealand economy and how it will continue to drive our housing market for the remainder of the year. Closer scrutiny will be given to falling dairy prices and the strengthening of the construction industry. Major global developments such as Brexit and rising US interest rates as well as how they aﬀect the New Zealand market will also be discussed. For more information visit www.apia.org.nz/future. MEMBERSHIP: Sign up for an APIA membership at www.apia.org.nz/register. APIA memberships include a free subscription to the NZ Property Investor, networking opportunities at over 100 events throughout the year, an excellent discount card, free subscription to APIATV, and massive savings oﬀ mortgage interest rates with the ANZ bank. For more information visit www.apia.org.nz or email admin@apia.org.nz.

TAURANGA

NEXT MEETING: Monday August 8, 7pm for 7.30 start. Tauranga Bowling Club Cameron Rd opposite McLean St, Tauranga. TOPIC: The Rotorua real estate market has gathered a full head of steam in the past year and is showing no signs of cooling. Hear about the investment opportunities from Debbie van den Broek (president of the Rotorua Property Investors Association) and Grant Utteridge (Telfer Young Rotorua). MEMBERSHIP: Annual subscription is $175, (plus a one oﬀ joining fee of $75) and, for an extra $70, copies of the NZ Property Magazine. For corporate membership contact the president at president@tpia.org.nz or email admin@tpia.org.nz. PO Box 15-033 Tauranga 3144

ROTORUA

MANAWATU

WAIRARAPA

NEXT MEETING: Tuesday August 9 , 6pm wine and nibbles. 7.15pm-9pm, BNZ Business Partners Centre, Central Mall (above Postie Plus), Rotorua. TOPIC: Daryl Fisher, property investor, will be speaking about the secret of his property success. Peter Lewis,who is a member of the NZPIF Executive Committee and the Northern Region Representative, will also be speaking. MEMBERSHIP: $230 for single or couple membership, which includes subscriptions to the NZ Property Investor and Uber Property magazines, extensive discounts with various companies. Free entry to our monthly meetings with refreshments and stimulating company. For more information contact Mike Ferreira on info@rpia.org.nz

NEXT MEETING: Wednesday August 3, doors open at 7pm for a 7.30pm start. Palmerston North Bridge Club, corner Cook and Cuba St, Palmerston North. TOPIC: Speaker will be Trevor Pringle on how to maintain rental properties. Trevor Pringle is an architect with more than 40 years’ experience in the construction industry. Trevor has been instrumental in the development of BRANZ’s extensive stable of information and education products. He has written a number of books including Maintaining Your Home (NZ and Australian versions), Landscape Construction, and BRANZ Housebuilding Guide. He has also spoken widely at conferences throughout the country and presented a large number of seminars on a wide range of building related topics. Enquiries to president, Pauline Beissel 0274719192 MEMBERSHIP: $175 for new memberships (single or couple), annual renewal $150. Membership includes subscription to the NZ Property Investor. For more information phone Pauline Beissel on 0274719192

NEXT MEETING: Thursday August 25, Harcourts oﬃce, Chapel St, Masterton. MEMBERSHIP: $165 which includes subscription to the NZ Property Investor. For more information contact Tim Horsbrugh on 021 992628 or email wairarapa@nzpif.org.nz

HAWKE’S BAY

NEXT MEETING: Wednesday, August 3, 6.30pm for a 7pm start at the Havelock North Community Centre. TOPIC: Crombie Lockwood representative Trevor Beard will speak. Networking and supper after the meeting. MEMBERSHIP: Membership subs are now $200 individual or couple membership annually. It includes monthly subscription to the NZProperty Investor, plus discounts available from NZPIF and local sponsors.We are a friendly group, offering social meetings during the year to members and coffee mornings to anyone interested in joining. Our experienced committee offer a buddy/ support system to new investors and networking over supper after every members meeting.Ten free monthly meetings each year for members. Non-members door fee $50 or free if joining on the night. Members may bring a guest once free of charge. For more information please phone or text the Association on 027- 858-7468, or email hawkesbay@nzpif.org.nz. Postal address is PO Box 12049, Ahuriri, Napier 4144.

TARANAKI NEXT MEETING: Tuesday August 16, 7.30pm St Mary’s Cathedral Peace Hall in Vivian St New Plymouth, opposite the Cathedral. TOPIC: A team approach to residential property investing. An expert panel discussion MEMBERSHIP: Annual subscriptions: Individual - $175; Couple - $235; Corporate $350. Enquiries to President Colin Comber 027 249 2864

Join any association to attend seminars and annual conference at member rates.

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// NZ PROPERTY INVESTOR

NZPIF: AROUND THE REGIONS

CAPITAL

WELLINGTON

MARLBOROUGH

NEXT MEETING: Tuesday August 9, 6.30pm for a 7.15pm start at the Salvation Army Auditorium, 92 Vivian St, Te Aro, Wellington. TOPIC: We welcome two very topical guest speakers for our August meeting. Phillip Squire from Sustainability Trust will outline the practical help that the trust can provide to landlords on heating solutions, smoke alarms and ways to keep their rental properties free from moisture. Our second speaker is Brian Nathan from law firm, Duncan Cotterill, who will discuss the impacts of the recent Health and Safety law changes and how they will affect landlords and their businesses. Non-members are welcome to come along and join us for our August presentation to members. Tea, coffee and biscuits are provided both before and after our meetings so that attendees can mingle and learn from each other. Our speakers will often stay after the meeting to answer any questions you may have. Free for members - $25 pp for walk ups. MEMBERSHIP: $215 single or sole proprietor (1 person); $235.00 Family Couple or Business (2 people). Call Karen 04 385 6676, email admin@capitalpia.org.nz or write to Capital PIA, PO Box 10524, The Terrace, Wellington 6143.

NEXT MEETING: Monday August 29, 6.45pm for a 7.15pm at the Wellesley Boutique Hotel, 2-8 Maginnity St, Wellington. TOPIC: The speakers are Andrew King, executive oﬃcer of the NZ Property Investors’ Federation and Helen Marriott, NZPIF Executive Committee member and Regional Representative. MEMBERSHIP: Annual subscription - $230 per entity (individual, couple, trust, LAQC, company etc). Membership gives you free admission to monthly members meetings, full subscription to NZ Property Investor. Plus discounts to WnPIA events, investor bus trips and seminars, NZPIF National Conference, paint, credit checks, hardware and more. Contact: contact@wnpia.co.nz ph 04 4729877 PO Box 1831 Wellington 6140. www.wnpia.co.nz Wellington's preferred Association, serving investors consistently and superbly for over 40 years.

NEXT MEETING: Wednesday August 17, 7pm

NZPIF Principal National Sponsor. 62

NZ PROPERTY INVESTOR

AUGUST 2016

for a 7.30pm start in the Chart Room, Scenic Hotel, Cnr Alfred and Henry Sts, Blenheim. TOPIC: Tenants/Landlords - trends and what the future holds. An interesting and entertaining evening with social researcher Kaye Saville Smith . MEMBERSHIP: The annual subscription is $185 per entity including copies of the NZ Property Investor, and $125 without magazine. For more information contact Brian Kerr, email nzwalnut@xtra.co.nz

NELSON

NEXT MEETING: Tuesday August 30 , 7.30pm at the ‘Honest Lawyer’, Point Rd, Monaco, Nelson. TOPIC: The speaker will be Andrew King, executive officer of the NZ Property Investors’ Federation. MEMBERSHIP: To join, contact Nelson@nzpif.co.nz. To find out more about the benefits of being a Nelson PIA member, email Nelson@nzpif.org.nz

CANTERBURY

NORTH OTAGO

OTAGO

NEXT MEETING: Tuesday August 16, 7.30pm at The Atrium, 455 Hagley Ave, Christchurch. TOPIC: Come and listen to a panel of experts from the BNZ. MEMBERSHIP: Application Fee $25 annual sub $250. Sign up for membership by registering on our website http://canterbury. nzpif.org.nz/. Membership to the Canterbury Property Investors’ Association includes free admission to our monthly members meetings with informative speakers, a subscription to the NZ Property Investor, an excellent discount card, plus much more. Further information email the office cpia@xtra. co.nz. For information on our special interest groups, go to our website or contact the office (03)379 5251. Office hours 10am-2pm, Mon-Fri.

NEXT MEETING: September, 2016. MEMBERSHIP: Annual membership is $150, includes a subscription to the NZ Property Investor. Further information, contact Jeanette

NEXT MEETING: Tuesday August 16, 7pm for

Halcrow at krow47@xtra.co.nz or call 03-434 8268, Postal address, 127 Wansbeck St, Oamaru. 9401.

SOUTHLAND

NEXT MEETING: Tuesday August 23,

7pm committee members meet and association members at 7.30pm at Club Southland, 115 Leet St, Invercargill. TOPIC: Guest speaker James Scholtck, a property developer from Nelson. MEMBERSHIP: For information, email southland.propertyinvestors@gmail.com or contact the secretary Debbie McKenzie - email: debbie.mckenzie@raywhite.com mobile 021 778 893. PO Box 5121, Waikiwi, Invercargill.

SOUTH CANTERBURY

NEXT MEETING: Thursday August 18 at 7.30pm at the Caroline Bay Lounge. TOPIC: Ron Hoy Fong will be the speaker. MEMBERSHIP: For information, contact Association President, Kerry Beveridge at kiwikerry@gmail.com or 021482840, or Secretary Di Middlemiss at themidds@xtra.co.nz

7.30pm, Forbury Park Function Centre, Victoria Rd, Dunedin (1st floor). TOPIC: Are your finances in check? Speaker, Lisa Dudson.Those who have heard Lisa Dudson speak know how she can make the highly important topic of money interesting… and even fun! She prides herself as being one of the few financial experts that actually speaks in terms people can understand. Thank you to our major sponsor, ANZ bank for providing the raffle prizes. Bring along your small change or eftpos will be available for you to buy your raffle tickets. Proceeds go towards purchasing resources for our members. MEMBERSHIP: Being a member of our association gives you the opportunity to network with over 1,000 Otago property investors; attend regular meetings with informative speakers; access discounted products and services from local businesses; receive regular glossy magazines and obtain a tax deduction from your OPIA subscription. If you would like to join please email opia@opia.org.nz or phone 03-4776220.

WEST COAST

NEXT MEETING: Contact the association for details of the next meeting. MEMBERSHIP: Two membership options exist. "Membership with Magazine" is $165. This includes 12 copies of the NZ Property Investor and free entry to West Coast PIA meetings held every second month. Alternatively, you can take the "membership only" option for $115pa with free entry to the West Coast PIA meetings.

WWW.PROPERTYINVESTOR.CO.NZ

// NZ PROPERTY INVESTOR

STATISTICS RENTAL RETURNS JUNE 2016

NATIONAL RENTAL PRICE MOVEMENT This map represents change in the average rental price between the months of June 2015 and June 2016, based on ďŹ gures from the Ministry of Business, Innovation & Employment.

+25% change no change -25% change

RENTAL SNAPSHOT Median house rents of the dominant dwelling type for the area

AUCKLAND - CITY

WELLINGTON - CITY

CANTERBURY - CHRISTCHURCH

NEW ZEALAND

NZ PROPERTY INVESTOR

AUGUST 2016

EXPLANATION OF STATISTICAL TERMS No. of Properties: No of Bonds: Median Rent: Rent Quartile Range: Median value: Gross Yield:

Total number of residential properties Total number of bonds lodged in last three months Weekly rent based on the bonds lodged in the latest three months Inter-quartile range of weekly rent based on the bonds lodged in the latest three months The median value of properties in the group based on estimating the current market value of each property using our E-Valuer at the end of the latest month Annualised median rent as a percentage of median property value for speciďŹ ed time period

Rental Area

No. Of No. Of Dwelling Bedrooms Properties Bonds

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change

Jan-16

NORTHLAND Far North - Rural Far North Far North - Ahipara/Kaitaia Far North - Mangonui/Kaeo Far North - Bay Of Islands Far North - Bay Of Islands Far North - Bay Of Islands Far North - Kaikohe Whangarei - North West Rural Whangarei - Kamo/Tikipunga/ Kensington Whangarei - Kamo/Tikipunga/ Kensington Whangarei - Whangarei Central/Otangarei Whangarei - Whangarei Central/Otangarei Whangarei - Whangarei Central/Otangarei Whangarei - Ngunguru/Onerahi/ Whangarei Heads/Waipu Whangarei - Ngunguru/Onerahi/ Whangarei Heads/Waipu Whangarei - Morningside/ Raumanga/Maunu Kaipara - Entire District Rodney - Wellsford/Warkworth/ Helensville Rodney - Wellsford/Warkworth/ Helensville Rodney - Wellsford/Warkworth/ Helensville Rodney - Orewa/Whangaparaoa Rodney - Orewa/Whangaparaoa Rodney - Orewa/Whangaparaoa Rodney - Orewa/Whangaparaoa Rodney - Rewiti/Kumeu/ Riverhead Rodney - Gulf Harbour Rodney - Gulf Harbour

House House House House House House House House House

3 3 3 2 3 4 3 3 3

2,139 1,251 1,113 650 2,737 1,401 718 1,192 3,573

34 17 18 19 40 10 16 19 50

220 - 300 240 - 260 260 - 300 245 - 328 320 - 380 350 - 500 240 - 275 320 - 357 310 - 375

260 250 282 290 350 410 255 330 340

6.1 -3.8 0.7 11.5 0.9 6.3 10.0 3.0

30.0 8.7 12.8 11.5 12.9 17.1 15.9 13.0 16.0

225,600 209,300 347,850 461,550 479,600 623,650 152,000 434,950 378,350

18.1 13.9 8.6 20.2 15.8 9.8 15.6 16.0 25.3

10.6 15.7 16.0 22.8 26.1 26.6 6.3 9.7 31.8

6.0 6.2 4.2 3.3 3.8 3.4 8.7 3.9 4.7

-10.1 -15.6 -7.2 -7.2 -12.9 -8.9 -8.1 -5.1 -17.7

17.5 -6.1 -2.7 -9.2 -10.5 -7.4 9.0 3.1 -12.0

House

1,299

372 - 440

410

7.3

17.1

467,550

18.2

36.4

4.6

-9.2

-14.1

Flat

906

247 - 276

260

8.3

13.0

260,800

20.9

24.1

5.2

-10.4

-8.9

House

429

285 - 345

300

4.5

20.0

306,600

17.1

29.9

5.1

-10.7

-7.6

House

1,759

320 - 392

370

21.3

23.3

344,450

20.1

29.2

5.6

1.0

-4.6

House

4,149

330 - 387

360

9.1

23.3

456,750

12.0

22.3

4.1

-2.6

0.8

House

1,735

390 - 470

447

6.4

31.5

601,700

9.6

27.3

3.9

-2.9

3.3

House House House

3 3 2

1,901 3,081 1,211

40 56 36

325 - 365 250 - 372 320 - 415

350 300 360

12.9 1.0 -0.6

22.8 25.0 20.0

314,950 394,150 639,150

17.3 22.2 19.7

25.9 36.6 31.9

5.8 4.0 2.9

-3.8 -17.4 -16.9

-2.5 -8.5 -9.0

House

4,679

395 - 480

450

7.1

28.6

774,700

27.6

62.4

3.0

-16.0

-20.8

House Flat House House House House House House

4 2 2 3 4 4 3 4

2,307 830 1,428 6,317 4,261 941 895 982

39 18 63 126 54 27 19 17

448 - 583 315 - 440 400 - 478 495 - 590 600 - 750 635 - 845 470 - 547 567 - 701

515 392 440 530 662 700 490 630

7.3 -2.0 2.3 6.0 6.8 7.7 1.0 10.5

22.6 30.7 33.3 27.7 27.3 18.6 25.0 37.0

943,700 636,000 708,550 843,100 1,013,400 1,051,500 728,350 852,100

10.0 13.4 14.2 7.2 16.0 9.1 10.1 12.0

33.7 76.6 71.9 74.5 50.1 68.1 44.9 50.2

2.8 3.2 3.2 3.3 3.4 3.5 3.5 3.8

-2.5 -13.6 -10.4 -1.1 -7.9 -1.3 -8.3 -1.3

-8.3 -26.0 -22.4 -26.8 -15.2 -29.4 -13.7 -8.8

House House Flat House House House House House House House

3 4 2 3 4 3 4 3 3 3

2,131 1,684 628 1,421 1,672 474 862 1,895 929 1,364

47 20 21 22 17 37 22 53 25 34

550 - 600 610 - 695 435 - 518 570 - 720 687 - 850 527 - 630 670 - 760 515 - 560 545 - 596 560 - 650

570 640 460 620 750 580 715 530 580 602

3.6 -5.2 3.4 -6.1 5.5 7.5 1.9 8.4 5.6

23.9 12.3 15.9 11.5 11.1 27.5 23.9 23.3 23.4 15.8

951,700 1,161,900 861,700 1,406,350 1,773,250 907,600 1,077,600 815,350 989,550 1,216,900

9.9 12.7 6.8 6.1 6.6 14.7 7.8 4.6 12.2 4.9

76.4 72.2 79.4 81.7 39.5 74.1 65.7 84.6 90.2 91.2

3.1 2.9 2.8 2.3 2.2 3.3 3.5 3.4 3.0 2.6

-5.7 -15.9 -3.2 -11.4 -6.2 -8.0 -0.3 -2.6 -3.4 0.6

-29.8 -34.8 -35.4 -38.6 -20.3 -26.8 -25.2 -33.2 -35.1 -39.4

House Flat House House Flat House

4 2 2 3 2 3

1,976 817 246 1,384 533 1,668

22 17 18 28 19 28

700 - 920 450 - 502 455 - 690 610 - 750 422 - 490 590 - 750

750 470 497 680 450 655

4.2 4.4 1.4 6.3 -3.6 0.8

22.0 24.7 11.7 19.9 19.4 9.2

1,405,650 777,350 1,130,450 1,355,600 803,000 1,495,650

12.3 4.9 7.8 14.0 8.7 15.7

76.7 71.9 96.1 74.6 81.9 74.3

2.8 3.1 2.3 2.6 2.9 2.3

-7.2 -0.4 -5.9 -6.8 -11.3 -12.9

-31.0 -27.5 -43.0 -31.3 -34.4 -37.4

AUCKLAND North Shore - Torbay North Shore - Torbay North Shore - East Coast Bays North Shore - East Coast Bays North Shore - East Coast Bays North Shore - Albany North Shore - Albany North Shore - Wairau Park/ GlenďŹ eld North North Shore - Browns Bay North Shore - Rothesay/ Murrays/Mairangi Bays North Shore - Rothesay/ Murrays/Mairangi Bays North Shore - Takapuna North Shore - Takapuna North Shore - Takapuna North Shore - Devonport North Shore - Devonport

PROPERTY MANAGERS GOING ON LEAVE?

DPM

ent y bereavem etc maternit surgery accident sickness holiday CALL THE DEPUTY NOW to book in on 0220 731158 deputypropertymanager@gmail.com www.deputypropertymanager.co.nz WWW.PROPERTYINVESTOR.CO.NZ // NZ PROPERTY INVESTOR 65

STATISTICS AUCKLAND CONT. Rental Area

No. Of No. Of Dwelling Bedrooms Properties Bonds

North Shore - North Harbour/ House Pine Hill North Shore - North Harbour/ House Pine Hill North Shore - Greenhithe/ House Unsworth Heights North Shore - Sunnynook/ Flat Westlake North Shore - Sunnynook/ House Westlake North Shore - Sunnynook/ House Westlake North Shore - Sunnynook/ House Westlake North Shore - Glendhu/Glenfield Flat North Shore - Glendhu/Glenfield House North Shore - Glendhu/Glenfield House North Shore - Hillcrest/ Flat Northcote North Shore - Hillcrest/ House Northcote North Shore - Hillcrest/ House Northcote North Shore - Hillcrest/ House Northcote North Shore - Beachhaven/ House Birkdale North Shore - Beachhaven/ House Birkdale North Shore - Chatswood/ Flat Birkenhead/Northcote Point North Shore - Chatswood/ House Birkenhead/Northcote Point North Shore - Chatswood/ House Birkenhead/Northcote Point North Shore - Chatswood/ House Birkenhead/Northcote Point Waitakere - West Harbour House Waitakere - West Harbour House Waitakere - Massey/Royal House Heights Waitakere - Massey/Royal House Heights Waitakere - Te Atatu Peninsula House Waitakere - Te Atatu House Waitakere - Ranui House Waitakere - Henderson Flat Waitakere - Henderson House Waitakere - Henderson House Waitakere - Henderson House Waitakere - Glendene House Waitakere - Kelston House Waitakere - Glen Eden House Waitakere - Titirangi House Waitakere - Titirangi House Waitakere - New Lynn Flat Waitakere - New Lynn House Waitakere - New Lynn House Waitakere - Western Beaches/ House Rural Waitakere - Western Beaches/ House Rural Auckland - Central East Apartment Auckland - Central East Apartment Auckland - Parnell Apartment Auckland - Parnell Apartment Auckland - Parnell House Auckland - Herne Bay/St Marys Apartment Auckland - Ponsonby/Freemans Apartment Bay Auckland - Ponsonby/Freemans Flat Bay Auckland - Ponsonby/Freemans House Bay Auckland - Pt Chevalier House Auckland - Grey Lynn/Arch Hill Apartment Auckland - Grey Lynn/Arch Hill Apartment Auckland - Grey Lynn/Arch Hill House Auckland - Westmere/Surrey House Crescent Auckland - Mt Eden Flat Auckland - Mt Eden Flat

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change

Jan-16

969

552 - 647

595

6.3

12.3

982,100

10.5

73.0

3.2

-3.9

-35.1

1,329

697 - 785

750

7.9

19.0

1,191,450

17.0

70.4

3.3

-7.8

-30.1

1,274

525 - 635

550

-7.9

22.2

939,750

12.3

76.8

3.0

-18.0

-30.9

672

450 - 520

480

6.7

33.3

772,050

11.0

92.1

3.2

-3.9

-30.6

255

450 - 540

497

8.8

21.2

1,004,100

10.3

90.5

2.6

-1.4

-36.4

2,477

550 - 620

580

5.5

23.4

1,009,500

8.0

92.4

3.0

-2.4

-35.9

4 2 2 3 2

1,189 587 245 2,945 663

17 22 15 46 26

617 - 735 400 - 450 442 - 490 505 - 565 370 - 450

675 415 450 532 420

3.8 6.4 5.9 6.4 5.0

22.7 25.8 32.4 26.7 20.0

1,222,200 632,900 789,150 813,950 677,200

8.5 11.1 13.2 13.6 8.5

88.6 92.8 90.1 81.9 88.6

2.9 3.4 3.0 3.4 3.2

-4.3 -4.2 -6.5 -6.3 -3.2

-34.9 -34.8 -30.4 -30.4 -36.4

214

405 - 460

430

2.4

19.4

879,000

10.3

96.0

2.5

-7.2

-39.1

1,987

530 - 625

555

-0.9

23.3

972,600

8.1

100.5

3.0

-8.3

-38.5

1,289

545 - 670

600

5.3

-1.6

1,158,400

9.8

79.5

2.7

-4.1

-45.2

477

418 - 462

440

4.8

22.2

732,850

11.3

94.7

3.1

-5.8

-37.2

3,651

495 - 550

520

5.7

23.8

789,000

10.6

91.9

3.4

-4.4

-35.5

442

407 - 470

450

3.4

25.0

630,800

12.8

82.7

3.7

-8.3

-31.6

300

450 - 540

480

3.9

26.3

894,900

7.1

62.3

2.8

-3.0

-22.2

1,994

551 - 707

600

23.7

1,088,600

13.8

72.8

2.9

-12.1

-28.4

4 3 4 3

1,666 2,184 1,687 3,687

17 64 28 84

657 - 981 465 - 607 605 - 795 450 - 500

800 525 660 475

17.6 7.1 16.4 5.6

45.5 29.6 16.8 28.4

1,245,650 843,750 1,117,450 688,400

8.2 5.7 15.0 11.2

67.2 82.6 83.2 100.2

3.3 3.2 3.1 3.6

8.7 1.4 1.2 -5.1

-13.0 -29.0 -36.2 -35.9

4 3 3 3 2 2 3 4 3 3 3 2 3 2 2 3 2

1,198 2,102 1,198 1,963 837 794 5,795 2,490 1,877 1,842 2,721 707 4,234 963 517 2,236 581

23 49 33 36 31 31 117 59 22 44 55 13 41 29 20 59 11

510 - 583 470 - 528 457 - 522 420 - 460 332 - 397 386 - 430 445 - 500 530 - 598 450 - 495 445 - 495 440 - 488 378 - 450 467 - 591 347 - 405 405 - 460 470 - 536 350 - 440

540 500 495 447 360 410 470 570 480 470 460 430 530 390 432 495 375

0.9 3.1 5.3 1.6 -2.7 3.8 4.4 3.2 5.6 2.2 7.5 6.0 2.6 6.7 5.3 -5.1

12.5 29.9 28.6 27.7 24.6 28.1 27.0 18.3 26.3 28.8 27.8 32.3 32.5 30.0 35.0 32.0 21.0

790,500 899,150 793,350 633,000 511,100 643,100 732,950 850,350 693,000 714,050 674,150 739,800 797,300 542,900 732,800 792,200 726,700

11.7 12.1 9.0 14.1 10.3 14.9 15.2 10.2 11.7 11.9 13.6 14.5 5.4 16.8 8.0 9.1 14.6

89.7 101.3 97.1 96.3 94.7 92.2 92.0 78.3 101.0 97.6 99.7 83.1 71.1 107.2 115.6 101.9 55.7

3.6 2.9 3.2 3.7 3.7 3.3 3.3 3.5 3.6 3.4 3.5 3.0 3.5 3.7 3.1 3.2 2.7

-9.6 -8.1 -3.4 -11.0 -11.8 -9.7 -9.3 -9.3 -7.6 -5.7 -10.0 -6.1 0.6 -12.1 -1.2 -3.5 -17.1

-40.7 -35.5 -34.8 -34.9 -36.0 -33.3 -33.8 -33.7 -37.1 -34.8 -36.0 -27.7 -22.6 -37.3 -37.4 -34.6 -22.3

3 1 2 1 2 3 2 1

1,769 4,260 2,545 241 365 644 244 163

32 257 143 29 37 21 19 16

420 - 550 360 - 436 460 - 598 407 - 536 547 - 650 783 - 1025 535 - 742 397 - 565

470 390 500 430 600 850 620 445

0.6 8.3 2.0 -0.8 9.7 10.7 -1.1

27.0 14.7 22.0 19.4 29.0 11.5 27.8 25.4

776,300 340,350 543,600 525,800 936,650 1,965,200 971,150 513,700

7.7 18.1 17.6 13.5 16.4 9.8 16.9 25.6

50.9 95.4 66.9 71.3 52.4 74.0 79.9 76.9

3.1 6.0 4.8 4.3 3.3 2.2 3.3 4.5

-6.6 -8.3 -13.2 -11.9 -14.8 -0.1 -5.3 -21.3

-15.8 -41.3 -26.9 -30.3 -15.3 -35.9 -28.9 -29.1

308

550 - 597

565

13.0

25.6

855,550

11.6

75.4

3.4

1.2

-28.4

3 3 1 2 4 3 1 2

1,318 1,478 303 352 517 1,223 683 756

37 14 23 23 11 21 47 31

798 - 995 620 - 700 442 - 498 550 - 647 826 - 1087 717 - 1008 316 - 397 420 - 515

850 655 460 600 1,000 820 350 470

2.4 -0.8 4.5 1.7 17.6 9.3 6.1 15.5

26.9 17.0 40.2 13.2 53.8 39.0 29.6 27.0

1,676,450 1,336,150 750,300 1,864,800 1,674,850 457,550 691,700

9.8 12.2 10.7 6.5 16.8 19.5 16.3

75.2 93.0 80.2 86.5 90.0 104.3 98.5

2.6 2.5 4.2 2.8 2.5 4.0 3.5

-6.7 -11.5 -8.1 10.5 -6.4 -11.3 -0.7

-27.6 -39.4 -37.2 -17.5 -26.8 -36.5 -36.0

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AUCKLAND CONT. Rental Area

Auckland - Mt Eden House Auckland - Waterview/Avondale Flat Heights Auckland - Waterview/Avondale House Heights Auckland - Avondale House Auckland - Blockhouse Bay/ House New Windsor Auckland - Mt Albert/Owairaka Flat Auckland - Mt Albert/Owairaka House Auckland - Mt Roskill/Wesley House Auckland - St Lukes/ Flat Sandringham Auckland - St Lukes/ House Sandringham Auckland - Epsom Flat Auckland - Three Kings House Auckland - Royal Oak/One Tree House Hill Auckland - Royal Oak/One Tree House Hill Auckland - Royal Oak/One Tree House Hill Auckland - Onehunga/Oranga/ Flat Te Papapa Auckland - Onehunga/Oranga/ House Te Papapa Auckland - Onehunga/Oranga/ House Te Papapa Auckland - Remuera Flat Auckland - Remuera House Auckland - Remuera House Auckland - Remuera South/ House Meadowbank South Auckland - Penrose/Mt Flat Wellington South Auckland - Penrose/Mt House Wellington South Auckland - Mission Bay/Orakei House Auckland - St Helliers/ House Glendowie Auckland - St Helliers/ House Glendowie Auckland - Ellerslie Flat Auckland - Ellerslie House Auckland - Glen Innes/Pt House England/Wai O Taiki Auckland - Mt Wellington North Flat Auckland - Otahuhu Flat Auckland - Otahuhu House Auckland - Waiheke Island House Auckland - Waiheke Island House Auckland - Central West Apartment Auckland - Central West Apartment Auckland - Central West Apartment Auckland - Lynﬁeld House Auckland - Newton/Grafton Apartment Auckland - Newton/Grafton Apartment Auckland - Eden Terrace Apartment Auckland - Hillsborough House Auckland - Meadowbank House Auckland - St Johns Flat Auckland - Mt Wellington Flat Manukau - Mangere Bridge/ House Airport Manukau - Mangere House Manukau - Mangere House Manukau - Otara House Manukau - Papatoetoe North Flat Manukau - Papatoetoe North House Manukau - Manukau Central House Manukau - Botony Downs House Manukau - Botony Downs House Manukau - Dannemora House Manukau - Dannemora House Manukau - Howick House Manukau - Howick House

Median Rent Median Value Yield 1 Yr 5 Yr 1 Yr 5 Yr Jan-16 Change Change Jan-16 Change Change Jan-16 Jan-15 Jan-11 670 -0.7 13.6 1,787,850 16.0 101.7 1.9 -14.5 -43.7 405 4.7 35.0 591,350 10.2 104.3 3.6 -5.1 -33.9

3 2

998 248

30 6

Rent Quartile Range 600 - 770 395 - 440

3 3 3 2 3 3 2

1,225 2,324 2,942 809 1,712 1,367 870

26 46 50 31 19 20 22

480 - 550 480 - 550 510 - 570 410 - 483 571 - 680 515 - 562 390 - 480

530 520 540 450 600 550 450

6.0 1.0 3.8 9.2 5.3 10.0 8.4

32.5 31.6 27.1 28.6 33.3 31.0 33.5

911,800 816,450 944,500 609,700 1,289,850 891,650 634,300

7.2 15.8 7.9 14.3 13.8 5.6 16.8

92.6 99.9 107.4 101.1 108.7 94.4 110.8

3.0 3.3 3.0 3.8 2.4 3.2 3.7

-1.1 -12.8 -3.7 -4.5 -7.5 4.2 -7.2

-31.2 -34.1 -38.8 -36.1 -36.1 -32.6 -36.7

3 2 3 2

1,310 752 675 402

19 31 10 20

591 - 650 453 - 517 550 - 630 390 - 560

625 490 590 515

4.2 8.9 2.3 -1.0

29.7 22.5 20.4 9.6

1,204,850 880,500 1,083,950 1,193,850

7.4 11.1 10.0 11.7

85.9 90.9 95.1 102.2

2.7 2.9 2.8 2.2

-3.0 -2.0 -7.0 -11.3

-30.2 -35.8 -38.3 -45.8

No. Of No. Of Dwelling Bedrooms Properties Bonds

1,630

588 - 707

635

5.8

21.0

1,378,550

14.2

88.7

2.4

-7.3

-35.9

1,288

688 - 931

800

6.7

23.1

1,785,750

8.7

71.3

2.3

-1.9

-28.2

1,689

420 - 467

440

3.5

23.9

616,050

8.3

86.3

3.7

-4.4

-33.5

1,242

397 - 505

455

1.1

23.0

892,250

5.6

88.6

2.7

-4.3

-34.8

3 2 3 4 3

2,666 448 1,924 2,009 1,393

54 11 29 12 28

530 - 650 450 - 563 612 - 850 1025 - 1325 610 - 790

597 510 720 1,147 697

8.5 7.4 5.9 44.3 16.2

20.6 30.8 16.1 49.0 27.9

995,750 886,800 1,766,450 2,442,300 1,240,950

8.0 10.6 4.9 3.0 11.1

71.8 83.6 56.9 77.0 84.7

3.1 3.0 2.1 2.4 2.9

0.5 -2.9 1.0 40.1 4.5

-29.8 -28.8 -26.0 -15.8 -30.8

366

367 - 430

400

2.0

25.0

559,150

20.9

116.6

3.7

-15.6

-42.3

3 3 3

1,729 1,301 2,033

29 19 28

493 - 561 607 - 753 600 - 762

520 690 675

6.2 -2.2

23.8 15.6 12.5

793,550 1,768,200 1,508,800

11.2 1.7 4.8

95.4 110.3 87.6

3.4 2.0 2.3

-10.1 4.4 -6.7

-36.6 -45.0 -40.0

4 2 3 3 2 2 3 2 3 1 2 3 3 1 2 2 3 3 2 2 3 3 4 3 2 3 3 3 4 3 4 2 3

1,606 620 1,360 1,801 604 481 1,222 1,700 1,926 3,356 3,175 533 1,921 811 1,008 488 1,979 823 360 319 2,158 4,045 673 3,153 590 1,353 1,354 2,496 2,446 1,202 2,772 244 1,964

14 18 26 18 31 26 23 28 35 219 172 20 33 49 63 31 37 7 23 11 25 28 11 33 24 20 20 30 29 29 38 23 34

760 - 1075 405 - 450 560 - 650 450 - 595 390 - 446 360 - 390 435 - 498 400 - 480 485 - 580 350 - 440 445 - 557 550 - 780 500 - 571 361 - 472 460 - 588 450 - 520 517 - 605 532 - 650 410 - 450 380 - 425 478 - 585 447 - 530 217 - 559 427 - 482 380 - 420 440 - 550 450 - 520 530 - 580 637 - 687 578 - 630 630 - 680 442 - 518 495 - 570

925 427 597 545 410 375 480 430 550 390 480 705 530 400 520 485 570 575 425 390 500 500 540 450 390 510 472 555 660 600 650 465 535

10.1 4.1 2.9 0.9 2.5 17.2 1.7 2.4 11.1 4.8 2.1 2.2 6.0 5.3 2.0 2.1 8.2 -19.0 6.3 3.1 8.7 1.9 3.4 -1.3 2.6 0.4 0.9 4.8 3.4 3.3 0.9

28.5 23.8 23.9 31.3 29.3 41.5 26.3 32.3 44.7 25.8 26.3 39.6 26.2 17.6 20.9 12.8 30.4 0.9 28.8 32.2 25.9 35.1 18.7 25.0 30.0 35.3 24.2 15.6 17.9 17.6 15.0 24.0 16.3

1,913,100 611,050 993,500 934,100 598,550 385,050 665,100 902,800 1,113,900 324,500 464,400 801,750 943,650 346,450 506,350 530,500 931,950 1,317,900 693,000 586,650 788,600 623,050 683,900 564,000 520,100 712,850 614,700 981,150 1,193,800 953,950 1,130,150 834,350 952,750

-4.0 19.2 5.7 10.7 20.1 23.8 13.5 22.0 19.2 23.4 18.4 12.3 11.9 26.3 13.3 13.8 6.3 4.6 11.3 21.3 16.4 22.9 14.9 19.0 15.9 14.9 17.6 12.5 18.0 16.6 20.4 14.1 3.8

71.0 94.2 87.8 113.3 113.7 119.7 107.3 42.5 67.8 78.7 66.8 44.7 84.9 79.1 60.3 76.0 79.0 74.7 114.3 104.0 114.0 99.8 116.8 91.1 90.8 83.1 81.4 82.9 78.8 82.6 88.9 69.5

2.5 3.6 3.1 3.0 3.6 5.1 3.8 2.5 2.6 6.2 5.4 4.6 2.9 6.0 5.3 4.8 3.2 2.3 3.2 3.5 3.3 4.2 4.1 4.1 3.9 3.7 4.0 2.9 2.9 3.3 3.0 2.9 2.9

14.7 -12.6 -2.6 -8.8 -14.7 -5.3 -10.4 -16.1 -6.8 -15.0 -13.7 -9.1 -5.3 -16.7 -10.0 -10.3 1.8 -22.6 -4.5 -17.5 -11.4 -11.6 -11.3 -13.1 -14.8 -10.7 -14.6 -10.3 -11.2 -11.3 -16.9 -9.5 -2.7

-24.9 -36.3 -34.1 -38.4 -39.5 -35.6 -39.1 -7.2 -13.7 -29.6 -24.2 -3.5 -31.7 -34.3 -24.5 -35.9 -27.1 -42.3 -38.3 -38.3 -36.9 -40.6 -42.4 -32.0 -29.1 -32.2 -36.2 -35.6 -34.2 -37.0 -34.4 -31.4

WWW.PROPERTYINVESTOR.CO.NZ

// NZ PROPERTY INVESTOR

STATISTICS

AUCKLAND CONT. Rental Area Manukau - Howick Manukau - Half Moon Bay/Farm Cove Manukau - Highland Park Manukau - Highland Park Manukau - Pakuranga Manukau - Pakuranga Manukau - Manukau and Manurewa Heights Manukau - Manukau and Manurewa Heights Manukau - Wattle Downs/ Conifer Grove Manukau - Manurewa North Manukau - Manurewa North Manukau - Manurewa North Manukau - Manurewa North Manukau - Mangere East Manukau - Papatoetoe South Manukau - Papatoetoe South Manukau - Papatoetoe West Manukau - Weymouth Manukau - Maraetai/Clevedon Manukau - Maraetai/Clevedon Papakura - Takanini/Ardmore Papakura - Takanini/Ardmore Papakura - Papakura/Drury/ Karaka Papakura - Papakura/Drury/ Karaka Papakura - Papakura/Drury/ Karaka Papakura - Papakura/Drury/ Karaka Franklin - Pukekohe/Tuakau Franklin - Pukekohe/Tuakau Franklin - Pukekohe/Tuakau Franklin - Waiuku Franklin - Rural Franklin Franklin - Rural Franklin

Median Rent Median Value Yield 1 Yr 5 Yr 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Jan-16 Change Jan-16 Change Change Change 650 3.2 15.0 1,208,200 12.0 72.6 2.8 -7.9 -33.4 520 15.6 980,050 14.3 79.8 2.8 -12.5 -35.7 530 8.2 20.5 967,450 13.8 100.8 2.8 -5.0 -40.0 645 15.2 29.0 1,123,100 11.9 84.1 3.0 2.9 -29.9 395 -1.3 19.7 635,850 11.3 90.4 3.2 -11.3 -37.1 530 6.0 26.2 902,050 13.3 99.4 3.1 -6.4 -36.7 520 -1.9 20.9 745,250 11.4 76.5 3.6 -12.0 -31.5

House House House House Flat House House

4 3 3 4 2 3 3

1,683 1,606 2,191 1,068 649 1,882 2,410

13 33 57 17 17 43 33

Rent Quartile Range 620 - 705 500 - 562 498 - 572 607 - 665 380 - 416 500 - 557 490 - 550

House

1,778

575 - 637

600

1.7

26.3

920,850

14.4

73.3

3.4

-11.1

-27.1

House Flat House House House House Flat House House House House House House House Flat

3 2 2 3 4 3 2 3 3 3 3 4 3 4 2

1,762 882 1,196 7,311 1,258 2,157 1,187 1,636 1,429 1,606 1,116 1,817 1,137 747 703

32 36 42 180 50 20 33 26 25 25 27 34 36 33 25

425 - 525 360 - 400 390 - 425 432 - 510 500 - 575 435 - 495 390 - 430 475 - 550 440 - 505 417 - 486 452 - 587 595 - 650 445 - 520 550 - 600 306 - 365

482 387 400 470 540 475 400 490 480 450 550 605 490 570 350

2.1 1.8 2.6 4.4 5.9 5.6 -2.0 -3.0 3.8 -4.0 2.1 1.8 -

29.6 31.2 33.3 34.3 25.6 25.0 27.0 23.4 29.7 28.6 27.9 6.1 34.2 21.3 27.3

706,450 430,300 522,350 580,750 711,000 625,000 518,350 786,500 666,550 575,150 963,800 1,106,100 632,950 785,750 444,500

16.8 13.5 15.0 20.3 16.3 18.5 20.3 22.3 19.3 15.4 19.7 17.3 19.4 14.1 15.7

74.7 94.9 107.0 105.2 98.3 106.2 90.2 111.1 95.5 95.4 67.6 63.7 92.1 75.5 88.0

3.5 4.7 4.0 4.2 3.9 4.0 4.0 3.2 3.7 4.1 3.0 2.8 4.0 3.8 4.1

-12.6 -10.3 -10.8 -13.2 -8.9 -11.0 -16.9 -19.9 -18.7 -13.4 -13.3 -18.1 -14.5 -10.8 -13.6

-25.8 -32.7 -35.6 -34.6 -36.7 -39.4 -33.2 -41.5 -33.6 -34.2 -23.7 -35.2 -30.1 -30.9 -32.3

House

1,012

360 - 430

397

13.4

36.0

514,450

16.0

91.8

4.0

-2.2

-29.1

House

5,814

139

420 - 480

450

2.3

32.4

587,650

16.0

86.8

4.0

-11.8

-29.1

House House House House House House House

4 2 3 4 3 3 4

2,300 645 4,083 2,297 1,623 1,557 881

65 21 105 50 24 37 35

490 - 628 347 - 377 390 - 470 500 - 580 400 - 440 420 - 560 532 - 600

540 360 430 530 417 470 550

8.0 2.9 7.5 8.2 4.3 17.5 22.2

31.7 33.3 26.5 24.7 34.5 44.6 22.2

792,200 478,450 554,700 713,050 524,050 557,850 748,100

12.9 16.1 12.8 10.3 19.6 8.7 17.9

70.6 69.9 64.7 52.6 56.7 30.0 49.6

3.5 3.9 4.0 3.9 4.1 4.4 3.8

-4.3 -11.4 -4.7 -1.9 -12.8 8.1 3.7

-22.8 -21.5 -23.2 -18.3 -14.2 11.3 -18.3

No. Of No. Of Dwelling Bedrooms Properties Bonds

Thousands of properties tested +40% tested positive!

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House

3,727

250 - 297

267

6.8

16.1

455,900

7.0

17.0

3.0

-0.2

-0.7

House House House House House House Flat House House House House

3 3 3 2 3 4 2 2 3 4 2

8,500 3,069 1,506 862 2,615 717 507 794 4,642 1,552 260

84 47 34 40 68 24 16 28 98 23 26

300 - 350 251 - 300 250 - 290 265 - 325 300 - 367 325 - 435 217 - 252 227 - 280 285 - 350 300 - 383 320 - 360

327 280 270 300 340 382 230 250 320 350 340

2.2 7.7 8.0 5.3 6.3 4.7 -2.1 8.5 7.7 4.0

21.1 16.7 22.7 20.0 22.7 19.4 21.1 13.6 23.1 18.6 22.7

561,700 291,750 271,050 366,200 387,050 480,500 258,850 269,450 327,600 447,750 457,050

12.5 20.5 40.4 25.9 25.3 17.7 11.4 26.6 19.5 11.2 20.3

20.7 32.1 45.6 38.9 49.4 25.8 19.5 29.3 26.0 26.0 56.2

3.0 5.0 5.2 4.3 4.6 4.1 4.6 4.8 5.1 4.1 3.9

-9.2 -10.6 -23.1 -16.4 -15.2 -11.1 -12.1 -21.0 -9.2 -3.1 -13.6

0.3 -11.7 -15.7 -13.6 -17.8 -5.1 1.3 -12.1 -2.4 -5.8 -21.4

House

3,991

100

380 - 422

397

5.9

20.3

537,900

25.9

64.3

3.8

-15.9

-26.8

House House House House

4 3 4 2

2,833 1,726 3,860 370

45 49 70 19

415 - 510 430 - 470 495 - 530 292 - 340

465 450 510 320

5.7 2.3 6.3 3.2

10.7 15.4 13.3 23.1

697,950 604,800 689,450 344,800

18.4 20.7 16.5 30.0

50.2 56.5 55.7 54.8

3.5 3.9 3.8 4.8

-10.7 -15.3 -8.8 -20.6

-26.3 -26.3 -27.2 -20.5

House

2,657

343 - 390

370

2.8

23.3

382,650

22.9

47.7

5.0

-16.4

-16.5

68 NZ PROPERTY INVESTOR // AUGUST 2016

Hamilton

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WAIKATO / BAY OF PLENTY CONT. Rental Area

No. Of No. Of Dwelling Bedrooms Properties Bonds

Hamilton - FairďŹ eld/Fairview House Downs Hamilton - Hamilton East/ Flat University Hamilton - Hamilton East/ House University Hamilton - Hamilton East/ House University Hamilton - Hamilton East/ House University Hamilton - Hillcrest/Silverdale/ House Tamahere Hamilton - Dinsdale North/ House Nawton Hamilton - Dinsdale South/ House Frankton Hamilton - Hamilton Central/ Flat Maeroa/Frankton Junction Hamilton - Hamilton Central/ House Maeroa/Frankton Junction Hamilton - Hamilton Central/ House Maeroa/Frankton Junction Hamilton - Deanwell/Melville/ Flat Fitzroy Hamilton - Deanwell/Melville/ House Fitzroy Hamilton - Deanwell/Melville/ House Fitzroy Hamilton - Deanwell/Melville/ House Fitzroy Waipa - Cambridge/Leamington House Waipa - Cambridge/Leamington House Waipa - Cambridge/Leamington House Waipa - Te Awamutu House Waipa - Rural Waipa House Waipa - Rural Waipa House Otorohanga/Waitomo - Both House Districts South Waikato - Entire District House South Waikato - Entire District House Taupo - Taupo Central/Tauhara House Taupo - Taupo Central/Tauhara House Taupo - Taupo West/Taupo House South Taupo - Taupo West/Taupo House South Taupo - Rural Taupo House Western Bay of Plenty - Kaimai/ House Te Puke Western Bay of Plenty - Kaimai/ House Te Puke Western Bay of Plenty - Waihi House Beach/Omokoroa Western Bay of Plenty - Waihi House Beach/Omokoroa Tauranga - Mt Maunganui Apartment Tauranga - Mt Maunganui Flat Tauranga - Mt Maunganui House Tauranga - Mt Maunganui House Tauranga - Mt Maunganui House Tauranga - Papamoa Beach House Tauranga - Papamoa Beach House Tauranga - Papamoa Beach House Tauranga - Pyes Pa/Hairini/ House Welcome Bay Tauranga - Pyes Pa/Hairini/ House Welcome Bay Tauranga - Tauranga Central/ Flat Greerton Tauranga - Tauranga Central/ House Greerton Tauranga - Tauranga Central/ House Greerton Tauranga - Tauranga Central/ House Greerton Tauranga - Bethlehem/ Flat Otumoetai Tauranga - Bethlehem/ House Otumoetai Tauranga - Bethlehem/ House Otumoetai Tauranga - Bethlehem/ House Otumoetai

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change

Jan-16

607

370 - 450

410

2.5

22.4

477,850

21.3

53.5

4.5

-15.5

-20.3

1,005

220 - 295

250

25.0

323,500

20.5

39.1

4.0

-17.0

-10.1

366

322 - 385

350

2.9

26.4

445,500

16.9

53.4

4.1

-11.9

-17.6

1,514

350 - 410

370

5.7

19.4

493,550

20.2

47.5

3.9

-12.1

-19.1

625

407 - 480

430

3.6

22.9

586,950

19.7

54.6

3.8

-13.4

-20.5

1,426

350 - 407

370

2.8

15.6

482,850

19.7

44.9

4.0

-14.1

-20.2

2,649

350 - 390

370

5.7

23.3

449,650

23.6

44.6

4.3

-14.5

-14.7

1,174

340 - 380

357

5.0

19.0

424,150

25.9

55.7

4.4

-16.6

-23.6

561

220 - 260

247

7.4

23.5

295,500

20.6

31.2

4.3

-11.0

-5.9

753

357 - 422

380

15.2

440,850

16.6

43.1

4.5

-14.3

-19.5

231

412 - 522

475

-5.0

43.9

599,750

15.9

28.3

4.1

-18.0

12.2

778

250 - 320

297

10.0

32.0

301,150

11.2

41.7

5.1

-1.1

-6.8

298

290 - 340

320

10.3

22.1

377,650

15.4

54.9

4.4

-4.4

-21.2

3,043

102

345 - 400

370

5.7

17.5

430,600

20.2

55.2

4.5

-12.1

-24.3

4 2 3 4 3 3 4 3 3 4 2 3 3

908 282 2,247 1,127 2,148 1,158 1,069 1,990 4,556 858 585 1,603 3,331

18 13 67 20 39 25 28 40 56 9 27 51 57

370 - 440 268 - 385 350 - 417 442 - 517 300 - 353 317 - 405 450 - 550 215 - 260 205 - 255 250 - 267 250 - 287 300 - 360 320 - 380

392 320 380 492 330 340 495 250 240 250 275 330 350

-4.4 5.6 11.8 4.1 9.7 11.2 8.7 23.1 8.7 5.8 7.5 2.9

12.0 28.0 22.6 36.7 13.8 21.4 41.4 13.6 33.3 25.0 19.6 21.3 11.1

505,750 416,200 468,900 589,500 358,800 394,600 573,700 190,100 146,450 216,600 247,550 305,250 428,000

18.6 23.2 16.7 18.6 20.8 21.6 15.8 10.1 9.3 11.3 11.5 14.0 11.8

45.1 46.4 42.4 33.8 27.7 35.9 28.7 13.9 8.8 13.7 7.9 10.5 17.7

4.0 4.0 4.2 4.3 4.8 4.5 4.5 6.8 8.5 6.0 5.8 5.6 4.3

-19.4 -18.8 -9.6 -5.7 -13.9 -9.8 -3.9 -1.3 12.6 -2.3 -5.2 -5.7 -7.9

-22.8 -12.6 -13.9 2.2 -10.9 -10.6 9.8 -0.2 22.6 9.9 10.8 9.8 -5.6

4 3 2

1,642 3,112 713

21 31 19

400 - 475 185 - 300 260 - 370

430 250 300

13.2 19.0 15.4

19.4 19.0 21.5

577,300 288,300 360,150

14.9 1.5 21.7

22.4 -2.0 32.9

3.9 4.5 4.3

-1.5 17.2 -5.2

-2.4 21.5 -8.6

2,101

340 - 420

355

12.7

26.8

399,000

18.0

25.4

4.6

-4.5

1.1

2,787

300 - 400

360

3.7

24.1

525,100

12.9

2.7

3.6

-8.1

20.9

4 2 2 2 3 4 2 3 4 3

1,398 565 779 813 3,918 1,378 574 4,535 2,647 4,223

21 15 22 29 77 12 20 102 38 75

350 - 476 405 - 526 310 - 385 361 - 405 420 - 500 450 - 520 355 - 397 420 - 490 470 - 550 386 - 450

450 440 360 380 450 500 377 457 500 420

7.1 11.4 12.5 8.6 11.1 4.2 12.5 10.1 6.4 13.5

24.3 12.8 38.5 31.0 29.7 13.6 41.2 34.4 19.0 27.3

658,300 578,850 478,050 611,800 691,950 960,150 491,850 600,300 721,300 507,300

11.1 26.5 16.5 24.3 23.5 16.5 25.0 24.3 16.3 26.3

16.4 26.2 52.0 54.9 25.2 43.6 55.1 58.4 41.7 35.8

3.6 4.0 3.9 3.2 3.4 2.7 4.0 4.0 3.6 4.3

-3.5 -12.0 -3.5 -12.7 -10.0 -10.6 -10.0 -11.4 -8.5 -10.1

6.8 -10.6 -8.9 -15.4 3.6 -20.9 -9.0 -15.2 -16.0 -6.3

2,593

457 - 521

490

6.5

22.5

642,200

27.0

44.2

4.0

-16.1

-15.0

996

300 - 340

320

10.3

28.0

356,800

28.2

48.8

4.7

-13.9

-14.0

1,390

336 - 380

350

6.1

29.6

405,800

29.2

54.4

4.5

-17.9

-16.1

4,365

109

370 - 430

400

8.1

25.0

477,700

38.3

47.6

4.4

-21.8

-15.3

1,125

405 - 543

450

13.4

21.6

595,900

24.6

39.6

3.9

-9.0

-12.9

726

311 - 357

330

13.8

37.5

371,900

11.0

4.6

2.5

880

337 - 420

370

13.8

37.0

524,150

24.4

63.3

3.7

-8.4

-16.1

4,903

102

400 - 450

425

9.0

32.8

566,100

23.2

42.4

3.9

-11.5

-6.7

3,023

420 - 535

500

6.4

22.0

814,400

35.4

47.3

3.2

-21.4

-17.2

WWW.PROPERTYINVESTOR.CO.NZ // NZ PROPERTY INVESTOR 69

STATISTICS

WAIKATO / BAY OF PLENTY CONT. Rental Area Rotorua - Holdens Bay/Owhata/ Ngapuna Rotorua - Kuirau/Hillcrest/ Glenholme Rotorua - Kuirau/Hillcrest/ Glenholme Rotorua - Kuirau/Hillcrest/ Glenholme Rotorua - Pukehangi South/ SpringďŹ eld Rotorua - Ngongotaha/Pleasant Heights/Koutu Rotorua - Ngongotaha/Pleasant Heights/Koutu Rotorua - Ngongotaha/Pleasant Heights/Koutu Whakatane - Whakatane Whakatane - Whakatane Whakatane - Whakatane Whakatane - Whakatane Kawerau - Entire District Opotiki - Entire District

No. Of No. Of Dwelling Bedrooms Properties Bonds

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change

Jan-16

House

2,082

262 - 365

335

21.8

25.5

310,250

22.6

23.6

5.6

-0.7

1.5

Flat

459

200 - 260

230

7.0

17.9

210,400

20.0

15.8

5.7

-10.8

1.8

House

810

228 - 306

265

8.2

17.8

269,650

28.7

33.8

5.1

-15.9

-11.9

House

1,954

322 - 378

340

9.7

21.4

314,550

16.6

16.0

5.6

-6.0

4.7

House

2,139

280 - 351

330

4.8

11.9

349,950

18.1

24.9

4.9

-11.3

-10.4

House

1,042

227 - 271

250

10.1

25.0

200,350

14.2

18.6

6.5

-3.5

5.4

House

4,728

127

280 - 330

300

7.1

20.0

233,650

8.3

11.3

6.7

-1.1

7.8

House Flat House House House House House

4 2 2 3 4 3 3

870 493 804 3,879 1,342 1,893 1,198

15 26 27 62 11 19 24

305 - 387 210 - 280 282 - 327 330 - 390 372 - 475 200 - 220 192 - 237

340 240 300 360 430 210 210

2.1 7.1 9.1 11.7 5.0 -

5.6 9.1 20.0 18.0 16.2 13.5 10.5

354,450 227,250 311,150 372,350 534,200 129,550 230,050

16.8 17.3 18.6 14.1 10.1 29.0 13.7

20.4 2.2 7.6 13.3 12.9 8.6 11.6

5.0 5.5 5.0 5.0 4.2 8.4 4.7

-14.4 -12.9 -9.7 -4.4 1.4 -18.6 -12.0

-12.3 6.8 11.5 4.2 2.9 4.5 -1.0

HAWKES BAY / GISBORNE Gisborne - Gisborne Gisborne - Gisborne Gisborne - Gisborne Gisborne - Gisborne Wairoa - Entire District Hastings - Havelock North Hastings - Havelock North Hastings - Flaxmere Hastings - Hastings/Clive Hastings - Hastings/Clive Hastings - Hastings/Clive Hastings - Hastings/Clive Napier - Napier Napier - Napier Napier - Napier Napier - Napier Napier - Taradale/Awatoto Napier - Taradale/Awatoto Central Hawkes Bay - Entire District

Flat House House House House Flat House House Flat House House House Flat House House House House House House

2 2 3 4 3 2 3 3 2 2 3 4 2 2 3 4 2 3 3

534 1,195 5,858 1,675 1,586 351 2,258 1,995 1,824 1,036 6,226 1,769 1,275 1,126 7,368 2,151 380 3,541 2,103

31 26 111 37 15 10 32 39 47 59 107 12 39 33 111 25 6 53 32

192 - 250 210 - 260 266 - 320 307 - 382 175 - 240 265 - 300 360 - 455 275 - 320 226 - 265 250 - 300 320 - 360 350 - 402 250 - 278 257 - 305 320 - 370 367 - 425 300 - 345 338 - 400 192 - 262

215 245 290 340 180 275 405 290 250 270 340 377 265 285 345 390 320 370 227

2.4 -2.0 1.8 6.3 3.8 12.5 7.4 2.0 1.9 4.6 1.9 5.2 1.8 7.8 2.6 15.5 7.2 16.4

13.2 8.9 7.4 17.2 7.8 5.8 22.0 16.0 12.6 8.0 13.3 3.3 15.2 11.8 13.1 8.3 25.5 15.6 3.2

167,900 172,850 215,450 317,350 140,500 286,550 460,650 186,350 209,350 262,800 303,150 406,100 258,850 287,250 355,300 486,100 358,400 408,750 208,950

-0.8 1.5 5.5 3.4 5.3 9.9 13.6 10.3 11.3 9.8 7.1 10.2 18.8 14.8 21.4 10.7 15.8 11.0 6.9

-11.1 -8.8 -4.4 -1.0 -4.0 17.2 14.5 20.4 12.6 11.5 15.2 17.4 23.6 10.0 29.4 11.2 18.9 17.8 9.0

6.7 7.4 7.0 5.6 6.7 5.0 4.6 8.1 6.2 5.3 5.8 4.8 5.3 5.2 5.0 4.2 4.6 4.7 5.6

3.2 -3.4 -3.5 2.8 -5.0 -5.5 -0.9 -2.6 -8.3 -7.2 -2.4 -7.5 -11.5 -11.4 -11.2 -7.3 -0.3 -3.4 8.9

27.3 19.4 12.3 18.4 12.3 -9.8 6.5 -3.6 -0.0 -3.2 -1.6 -12.0 -6.8 1.6 -12.6 -2.6 5.5 -1.9 -5.3

Flat

514

230 - 270

250

6.4

255,850

9.3

21.6

5.1

-8.5

-12.5

House

468

275 - 322

300

3.4

11.1

301,250

4.7

19.4

5.2

-1.2

-6.9

House

2,480

337 - 370

350

9.4

329,450

5.9

12.0

5.5

-5.6

-2.3

Flat

1,444

250 - 290

272

6.7

20.9

283,050

9.7

20.7

5.0

-2.8

0.2

House

1,115

280 - 325

300

-3.2

15.4

429,000

27.0

50.7

3.6

-23.8

-23.5

House

7,344

129

348 - 396

370

13.1

400,300

2.0

19.7

4.8

-2.0

-5.5

House

3,775

380 - 540

437

-2.2

9.3

544,900

-2.6

20.2

4.2

0.3

-9.1

House

2,294

277 - 320

300

-3.2

15.4

264,850

6.6

22.0

5.9

-9.2

-5.4

House House House House House House

3 3 3 3 3 4

595 1,448 2,334 2,161 2,542 512

17 23 50 42 34 -

265 - 388 222 - 270 245 - 300 195 - 250 180 - 230 -

300 250 275 225 205 -

8.3 10.0 2.3 7.9 -

9.1 8.7 10.0 21.6 13.9 -

343,950 207,050 213,250 136,600 145,000 198,700

4.4 11.8 2.6 0.5 12.7 2.7

16.3 8.9 0.4 4.7 -8.0 -0.3

4.5 6.3 6.7 8.6 7.4 -

3.7 -10.6 7.2 1.7 -4.3 -

-6.2 -0.2 9.5 16.1 23.8 -

TARANAKI New Plymouth - New Plymouth Central/Moturoa New Plymouth - New Plymouth Central/Moturoa New Plymouth - New Plymouth Central/Moturoa New Plymouth - Outer New Plymouth New Plymouth - Outer New Plymouth New Plymouth - Outer New Plymouth New Plymouth - Outer New Plymouth New Plymouth - Waitara/ Inglewood New Plymouth - Rural New Plymouth Stratford - Entire District South Taranaki - Hawera South Taranaki - Rural South Taranaki Ruapehu - Entire District Ruapehu - Entire District

70 NZ PROPERTY INVESTOR // AUGUST 2016

Rental Area

No. Of No. Of Dwelling Bedrooms Properties Bonds

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change

Jan-16

MANAWATU / WANGANUI Wanganui - Entire District Wanganui - Entire District Wanganui - Entire District Wanganui - Entire District Rangitikei - Entire District Manawatu - Entire District Manawatu - Entire District Palmerston North - Highbury/ Westbrook Palmerston North - Takaro/ Cloverlea/Milson Palmerston North - Hospital/ Papaeoia Palmerston North - Kelvin Grove/Roslyn Palmerston North - Awapuni South/Westend Palmerston North - Terrace End/ Hokowhitu East Palmerston North - Hokowhitu West and Lagoon Tararua - Entire District Horowhenua - Entire District Horowhenua - Entire District Horowhenua - Entire District Horowhenua - Entire District

Flat House House House House House House

2 2 3 4 3 3 4

1,724 1,486 8,213 2,542 2,461 3,960 1,686

25 41 119 30 31 62 23

155 - 215 180 - 241 211 - 273 250 - 350 181 - 220 260 - 325 312 - 373

180 220 240 290 200 300 340

9.1 12.8 1.3 5.3 3.4 13.3

12.5 22.2 9.1 20.8 9.9 17.6 21.4

137,200 157,400 187,100 288,000 143,000 252,500 356,200

13.1 9.6 -4.2 9.5 3.6 9.4 7.0

6.0 -0.5 3.1 3.6 0.2 14.8 9.1

6.8 7.3 6.7 5.2 7.3 6.2 5.0

-3.5 2.9 5.7 -8.6 1.6 -5.4 5.9

6.1 22.8 5.8 16.6 9.7 2.5 11.3

House

1,487

280 - 310

300

14.5

242,900

11.3

11.4

6.4

-10.2

2.7

House

2,406

290 - 325

310

10.7

281,550

7.7

11.9

5.7

-7.1

-1.0 1.2

Flat

466

180 - 226

210

-4.5

15.4

221,300

10.1

14.0

4.9

-13.3

House

1,835

300 - 350

330

10.0

22.2

282,200

6.6

12.8

6.1

3.2

8.4

House

1,069

300 - 345

315

-1.6

5.0

301,450

9.8

13.5

5.4

-10.3

-7.5

House

1,282

326 - 360

340

3.0

13.3

320,150

9.5

19.9

5.5

-5.9

-5.5

Flat

282

220 - 272

235

2.2

17.5

238,300

7.1

10.2

5.1

-4.6

6.6

House Flat House House House

3 2 2 3 4

2,659 1,142 1,832 6,026 1,747

29 18 40 103 21

188 - 212 180 - 210 195 - 240 230 - 283 273 - 320

196 195 220 260 295

2.1 2.6 12.8 5.3 3.5

5.9 11.4 22.2 15.6 9.3

152,450 175,800 189,250 214,800 340,550

10.3 18.8 11.1 2.6 7.8

-3.8 10.7 5.8 8.8 9.0

6.7 5.8 6.0 6.3 4.5

-7.5 -13.6 1.5 2.6 -3.9

10.2 0.6 15.5 6.2 0.2

House House

2 3

1,523 4,120

36 63

280 - 330 302 - 400

315 360

5.0 7.5

22.6 20.0

322,900 385,750

-10.5 6.1

23.2 12.7

5.1 4.9

17.4 1.3

-0.5 6.4

House

1,437

308 - 370

340

9.7

20.6

369,450

11.3

18.9

4.8

-1.4

1.4

House

5,168

357 - 422

385

4.1

16.7

427,950

7.8

13.4

4.7

-3.5

2.9

House

2,515

460 - 530

492

10.1

23.0

548,650

9.1

16.6

4.7

0.9

5.5 -6.6

WELLINGTON Kapiti Coast - Waikanae/Otaki Kapiti Coast - Waikanae/Otaki Kapiti Coast - Paraparaumu/ Raumati Kapiti Coast - Paraparaumu/ Raumati Kapiti Coast - Paraparaumu/ Raumati Porirua - Paremata/Mana/ Pukerua Bay Porirua - Papakowhai/Whitby/ Pauatahanui Porirua - Papakowhai/Whitby/ Pauatahanui Porirua - Titahi Bay/Onepoto/ Elsdon Porirua - Porirua East/ Waitangirua Upper Hutt - Trentham North/ Wallaceville Upper Hutt - Heretaunga/ Silverstream Upper Hutt - Trentham West/ Eldersley/Clouston Park Upper Hutt - Trentham West/ Eldersley/Clouston Park Upper Hutt - Totara Park/ Maoribank/Te Marua Lower Hutt - Stokes Valley Lower Hutt - Western Hills/ Haywards Lower Hutt - Wainuiomata Lower Hutt - Taita/Naenae Lower Hutt - Epuni/Avalon Wellington - Johnsonville/ Newlands Wellington - Johnsonville/ Newlands

House

1,440

400 - 503

420

8.5

522,000

15.4

16.2

4.2

-13.3

House

2,142

407 - 522

465

16.3

22.4

433,750

8.2

15.8

5.6

7.4

5.7

House

2,373

520 - 615

570

3.6

11.8

591,300

10.4

12.3

5.0

-6.1

-0.5

House

2,042

340 - 395

375

1.4

8.7

341,400

13.5

20.4

5.7

-10.7

-9.8

House

2,461

317 - 363

350

12.9

25.0

257,400

24.5

15.5

7.1

-9.3

8.2 -5.6

Flat

629

245 - 290

260

4.0

15.6

230,850

20.3

22.4

5.9

-13.6

House

1,543

395 - 460

445

6.0

15.6

407,250

-0.8

14.3

5.7

6.8

1.2

Flat

661

225 - 280

260

4.0

15.6

224,850

9.5

17.4

6.0

-5.0

-1.6

House

2,633

380 - 467

415

9.2

18.6

362,400

6.3

16.2

6.0

2.7

2.0

House

2,142

370 - 440

395

9.1

12.9

333,800

10.3

13.8

6.2

-1.0

-0.9

House

1,937

338 - 380

360

2.9

5.9

309,750

9.2

12.1

6.0

-5.8

-5.5

House

2,442

390 - 490

420

5.8

12.9

460,250

17.5

27.0

4.7

-9.9

-11.1

House House House

3 3 2

4,059 2,312 513

39 21 13

310 - 350 340 - 365 303 - 345

320 350 320

3.2 -2.8 -5.9

6.7 9.4 -2.1

266,950 305,400 395,500

17.3 10.9 12.3

13.1 16.2 19.1

6.2 6.0 4.2

-12.0 -12.3 -16.2

-5.7 -5.8 -17.8

Flat

1,070

325 - 370

352

10.0

23.5

338,650

18.0

23.9

5.4

-6.8

-0.3

House

471

330 - 400

367

1.9

12.9

439,200

18.3

28.5

4.3

-13.8

-12.1

WWW.PROPERTYINVESTOR.CO.NZ

// NZ PROPERTY INVESTOR

STATISTICS We work with property investors right across Wellington, the Hutt Valley and Hawke’s Bay. Call us to achieve less stress, better returns and peace of mind. Oxygen is a part of Professionals, Redcoats Limited

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WELLINGTON CONT. Rental Area

No. Of No. Of Dwelling Bedrooms Properties Bonds

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change

Jan-16

Wellington - Johnsonville/ House Newlands Wellington - Johnsonville/ House Newlands Wellington - Tawa/Grenada House North Wellington - Tawa/Grenada House North Wellington - Ngaio/ Flat Kaiwharawhara/Wilton Wellington - Ngaio/ House Kaiwharawhara/Wilton Wellington - Wadestown/ Apartment Thorndon Wellington - Wadestown/ Apartment Thorndon Wellington - Wadestown/ House Thorndon Wellington - Lambton Apartment Wellington - Lambton Apartment Wellington - Te Aro Apartment Wellington - Te Aro Apartment Wellington - Mt Victoria/ Apartment Roseneath Wellington - Mt Victoria/ House Roseneath Wellington - Hataitai Flat Wellington - Vogeltown/ Flat Berhampore/Newtown Wellington - Vogeltown/ House Berhampore/Newtown Wellington - Vogeltown/ House Berhampore/Newtown Wellington - Island Bay/Melrose House Wellington - Miramar/ House Strathmore Wellington - Miramar/ House Strathmore

4,816

125

420 - 480

450

16.9

479,600

15.6

27.6

4.9

-13.5

-8.4

2,644

487 - 605

530

7.1

605,050

11.9

24.7

4.6

-10.6

-14.1

1,956

391 - 470

440

2.3

15.8

448,100

17.1

31.0

5.1

-12.6

-11.6

1,429

462 - 568

480

2.1

5.5

539,250

12.9

26.7

4.6

-9.5

-16.7

372

300 - 350

320

-7.8

10.3

358,450

17.5

22.7

4.6

-21.5

-10.0

1,589

450 - 580

500

6.4

7.5

614,000

13.1

21.0

4.2

-5.9

-11.1

366

290 - 397

305

-5.3

-12.9

228,050

10.3

0.5

7.0

-14.1

-13.3

280

442 - 547

490

8.9

6.5

456,900

10.7

9.8

5.6

-1.6

-3.0

593

482 - 690

535

-10.8

-7.8

802,300

11.9

16.3

3.5

-20.3

-20.7

1 2 1 2

884 841 1,002 1,610

46 52 116 95

300 - 420 452 - 580 315 - 440 450 - 580

345 500 360 510

-1.4 -2.7 2.0

-1.4 18.5 12.5 4.1

194,900 396,750 248,550 549,150

7.7 12.1 5.4 44.0

-9.1 12.8 1.6 28.4

9.2 6.6 7.5 4.8

-8.5 -10.8 -7.7 -29.2

8.4 5.0 10.7 -18.9

Masterton - Entire District Masterton - Entire District Carterton/South Wairarapa Both Districts Carterton/South Wairarapa Both Districts

House House House House

342

412 - 550

495

2.7

20.7

413,400

13.7

14.2

6.2

-9.7

5.7

425

627 - 850

707

9.6

26.3

959,800

8.9

23.5

3.8

0.6

2.2

244

347 - 400

375

1.4

10.3

404,650

23.2

4.8

-10.5

363

360 - 400

390

8.3

25.8

355,600

14.8

15.2

5.7

-5.6

9.2

465

432 - 500

475

12.6

25.0

554,600

18.2

30.0

4.5

-4.8

-3.9

1,262

505 - 600

550

5.8

10.7

640,950

19.4

29.2

4.5

-11.4

-14.3

1,587

500 - 615

545

4.8

13.5

672,500

20.2

35.7

4.2

-12.8

-16.4

481

347 - 483

400

5.3

545,850

22.6

37.2

3.8

-18.4

-23.3

2,127

472 - 577

520

-1.0

11.8

628,100

16.5

34.5

4.3

-15.0

-16.9

2 3

1,062 4,624

38 95

220 - 270 260 - 300

247 280

5.1 3.7

17.6 16.7

216,200 243,550

6.6 -3.0

11.4 4.6

5.9 6.0

-1.4 6.9

5.6 11.5

819

232 - 250

250

2.0

19.0

264,100

20.2

20.7

4.9

-15.1

-1.3

3,385

257 - 312

290

4.7

18.4

286,600

-0.5

9.7

5.3

5.2

7.9

House

3,596

389 - 430

405

3.8

12.5

457,250

-1.7

11.7

4.6

5.7

0.7

House

1,921

426 - 522

450

18.4

601,350

10.3

20.5

3.9

-9.3

-1.7

House

1,074

260 - 350

332

18.6

23.0

357,000

9.6

15.2

4.8

8.2

6.8

House

3,735

332 - 377

360

7.5

20.0

475,000

23.8

36.5

3.9

-13.2

-12.1 -11.3

NELSON / TASMAN Tasman - Richmond/Wakeﬁeld/ Brightwater/Mapua Tasman - Richmond/Wakeﬁeld/ Brightwater/Mapua Tasman - Motueka/Rural Tasman Tasman - Motueka/Rural Tasman Nelson - Stoke/Nayland/ Tahunanui Nelson - Stoke/Nayland/ Tahunanui Nelson - Stoke/Nayland/ Tahunanui Nelson - Port Hills/Tahuna Hills Nelson - Nelson Central/Nelson North Nelson - Nelson Central/Nelson North Nelson - Nelson Central/Nelson North Nelson - Nelson Central/Nelson North Marlborough - Sounds/Rural Marlborough Marlborough - Blenheim Central

Flat

720

272 - 317

282

1.8

12.8

278,950

13.9

27.1

5.3

-10.6

House

1,006

308 - 351

330

4.1

13.8

342,500

9.0

18.7

5.0

-4.5

-4.1

House

3,775

350 - 420

375

-1.3

7.1

423,550

8.3

23.6

4.6

-8.9

-13.3

House

1,323

325 - 430

360

7.5

457,900

13.2

9.7

4.1

-11.7

-2.1

Flat

626

285 - 310

292

0.7

21.7

273,250

9.5

11.1

5.6

-8.0

9.6

House

1,102

300 - 366

325

-1.5

12.1

375,000

12.4

23.9

4.5

-12.4

-9.6

House

3,513

350 - 410

375

-1.3

10.3

455,250

12.2

24.7

4.3

-12.1

-11.6

House

1,321

395 - 500

415

-2.4

9.2

617,400

11.6

27.9

3.5

-12.5

-14.6

House

2,695

257 - 300

290

6.6

3.6

421,700

12.6

14.3

3.6

-5.3

-9.3

Flat

865

240 - 260

250

4.2

8.7

233,050

2.1

20.8

5.6

2.0

-10.0

Nelsons Best Property Management Company 03 548 3440 www.havenpm.co.nz 72 NZ PROPERTY INVESTOR // AUGUST 2016

6 MONTH

t t t t

MONEY BACK

PROPERTY

GUARANTEE

MANAGEMENT

'SFF JOEFQFOEFOU SFOUBM BQQSBJTBMT 7JEFP UPVS NBSLFUJOH -PX SBUJP PG QSPQFSUJFT QFS NBOBHFS 5IF NPTU DPNQSFIFOTJWF JOTQFDUJPOT

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NELSON / TASMAN CONT. Rental Area Marlborough - Blenheim Central Marlborough - Blenheim Central Marlborough - Blenheim Outer/ Renwick Kaikoura/Hurunui - Both Districts Buller - Entire District Grey - Entire District Waimakariri - Rangiora/Kaiapoi Waimakariri - Rangiora/Kaiapoi Waimakariri - Rural Waimakariri

No. Of No. Of Dwelling Bedrooms Properties Bonds

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change 295 13.5 18.0 340 13.3

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change 269,800 8.6 18.8 5.7 4.4 -0.7 333,050 8.9 20.0 5.3 -8.2 -5.6

Jan-16

House House

2 3

654 3,223

21 50

283 - 300 320 - 375

House

2,571

281 - 380

340

3.0

21.4

394,350

16.6

24.1

4.5

-11.6

-2.1

House House House Flat House House

3 3 3 2 3 3

2,493 2,130 2,528 788 4,211 2,785

22 41 41 17 55 51

270 - 350 180 - 250 230 - 290 307 - 340 370 - 400 396 - 450

300 220 250 320 390 420

-4.3 -3.8 -1.5 5.0

20.0 -18.5 -3.8 28.0 21.9 40.0

365,000 189,450 204,750 305,750 452,850 409,050

2.7 -0.2 -3.0 5.3 15.7 -6.9

17.0 -2.4 -5.4 29.9 46.0 17.6

4.3 6.0 6.3 5.4 4.5 5.3

-2.6 -4.2 -0.8 -6.5 -13.5 12.8

2.6 -16.5 1.6 -1.4 -16.5 19.0

House

1,351

235 - 327

310

12.7

29.2

232,700

-1.5

1.7

6.9

14.5

27.1

House Flat House House House

3 2 2 3 4

2,067 855 825 3,112 853

31 24 25 74 22

400 - 500 292 - 322 317 - 363 370 - 415 450 - 500

470 307 348 399 490

6.8 2.3 8.8 -0.3 -2.0

17.5 38.3 39.2 33.0 40.0

622,800 263,950 328,000 383,700 519,000

-2.3 1.6 0.4 0.6 0.7

26.4 40.5 38.5 31.2 37.5

3.9 6.0 5.5 5.4 4.9

9.4 0.7 8.3 -0.8 -2.6

-7.0 -1.6 0.5 1.4 1.8

House

3,369

365 - 407

390

-0.5

34.5

320,200

0.1

33.0

6.3

-0.6

1.1

House

1,138

280 - 352

322

0.6

28.8

334,250

6.1

33.4

5.0

-5.2

-3.4

House

2,902

378 - 425

400

-2.4

29.0

396,050

3.7

34.7

5.3

-5.9

-4.2

WEST COAST Westland - Entire District

CANTERBURY Christchurch - Redcliffs/Sumner Christchurch - Woolston/Opawa Christchurch - Woolston/Opawa Christchurch - Woolston/Opawa Christchurch - Woolston/Opawa Christchurch - Aranui/Bromley/ Bexley Christchurch - North Beach/ New Brighton/Southshore Christchurch - North Beach/ New Brighton/Southshore Christchurch - North Beach/ New Brighton/Southshore Christchurch - Styx/Parklands Christchurch - Styx/Parklands Christchurch - Marshland/ Redwood Christchurch - Marshland/ Redwood Christchurch - Linwood/Phillipstown Christchurch - Linwood/Phillipstown Christchurch - Linwood/Phillipstown Christchurch - Sydenham/ Waltham Christchurch - Sydenham/ Waltham Christchurch - Sydenham/ Waltham Christchurch - St Martins/ Beckenham/Huntsbury Christchurch - Westmorland/ Cashmere/Barrington Christchurch - Westmorland/ Cashmere/Barrington Christchurch - Spreydon/ SomerďŹ eld Christchurch - Spreydon/ SomerďŹ eld Christchurch - Hillmorton/Hoon Hay Christchurch - Richmond/Shirley Christchurch - Merivale/St Albans West Christchurch - St Albans North/ Mairehau Christchurch - Fendalton/ Strowan/Bryndwr Christchurch - Fendalton/ Strowan/Bryndwr Christchurch - Riccarton Christchurch - Riccarton Christchurch - Riccarton Christchurch - Sockburn/Upper Riccarton Christchurch - Halswell/Wigram Christchurch - Halswell/Wigram Christchurch - Hornby/Islington/ Hei Hei Christchurch - Ilam/Westburn

House

672

440 - 512

464

-5.3

30.7

482,600

4.9

21.0

5.0

-9.8

8.0

House House

3 4

2,076 1,547

34 31

390 - 450 495 - 545

420 500

-3.4 -6.5

29.2 11.1

411,550 622,200

-1.1 7.3

27.0 29.1

5.3 4.2

-2.3 -12.9

1.8 -13.9

House

2,532

396 - 457

420

-3.4

23.5

456,100

2.3

33.2

4.8

-5.6

-7.2

House

2,051

473 - 546

520

-3.7

13.0

601,350

1.1

23.8

4.5

-4.8

-8.7

Flat House House

2 2 3

1,262 428 1,329

60 39 52

290 - 320 310 - 360 350 - 435

307 329 385

-1.0 2.8 -3.0

46.2 26.5 24.2

257,100 311,300 345,750

3.9 -2.5 -2.2

32.0 42.1 38.8

6.2 5.5 5.8

-4.7 5.4 -0.8

10.7 -11.0 -10.5

Flat

983

270 - 319

290

-9.4

34.9

279,450

-2.0

26.2

5.4

-7.6

6.9

House

381

337 - 389

355

-4.1

22.4

348,500

0.8

41.8

5.3

-4.9

-13.7

House

837

378 - 450

420

3.7

40.0

377,550

-4.4

32.1

5.8

8.5

6.0

House

1,552

440 - 520

460

2.2

27.8

502,700

-6.8

28.8

4.8

9.7

-0.8

House

1,610

423 - 500

460

25.3

575,150

1.8

30.9

4.2

-1.8

-4.2

House

1,585

487 - 672

552

0.4

14.5

751,250

-1.5

20.6

3.8

1.9

-5.0

House

2,741

400 - 453

430

-2.3

33.5

438,400

2.1

36.4

5.1

-4.3

-2.1

House

517

450 - 531

495

23.8

508,750

1.9

32.9

5.1

-2.8

-6.9

House

2,421

390 - 460

430

-1.1

28.4

425,400

-1.2

39.1

5.3

0.0

-7.7

House

2,125

387 - 440

410

2.5

26.2

394,650

-0.4

37.3

5.4

2.9

-8.1

Flat

898

320 - 365

340

-2.9

30.8

408,200

7.3

42.7

4.3

-9.5

-8.4

House

1,557

392 - 455

430

-4.4

22.9

578,550

7.9

32.3

3.9

-11.4

-7.2

House

1,589

400 - 596

495

4.2

17.9

801,800

5.4

36.9

3.2

-1.2

-13.9

House

1,794

520 - 700

550

-9.1

5.8

1,080,150

7.6

22.2

2.6

-15.5

-13.5

Flat House House

2 2 3

1,147 305 985

55 35 47

320 - 366 332 - 387 396 - 483

345 370 440

-6.8 -4.3

32.7 25.4 22.2

347,650 468,150 527,150

2.1 6.9 2.5

36.4 33.2 40.5

5.2 4.1 4.3

-8.7 -6.5 -6.7

-2.7 -5.8 -13.0

House

1,321

410 - 459

435

3.6

27.9

457,800

0.8

33.9

4.9

2.7

-4.5

House House

3 4

3,724 3,538

75 30

430 - 495 525 - 580

470 550

4.4 -

30.6 25.0

480,850 635,450

-0.2 3.9

27.5 20.1

5.1 4.5

4.7 -3.8

2.4 4.1

House

3,352

392 - 450

417

-5.2

28.3

410,850

4.8

40.9

5.3

-9.6

-8.9

House

884

395 - 478

440

-6.4

21.5

581,500

6.5

48.6

3.9

-12.1

-18.2

WWW.PROPERTYINVESTOR.CO.NZ

// NZ PROPERTY INVESTOR

STATISTICS CANTERBURY CONT. No. Of No. Of Dwelling Bedrooms Properties Bonds

Rental Area Christchurch - Avonhead/ Yaldhurst Christchurch - Avonhead/ Yaldhurst Christchurch - Burnside/Harewood Christchurch - Burnside/Harewood Christchurch - Bishopdale/ Papanui Christchurch - Bishopdale/ Papanui Christchurch - Sawyers Arms/ Northcote/Belfast Christchurch - Sawyers Arms/ Northcote/Belfast Banks Peninsula/Selwyn - Both Districts Banks Peninsula/Selwyn - Both Districts Banks Peninsula/Selwyn - Both Districts Ashburton - Entire District Ashburton - Entire District Ashburton - Entire District Ashburton - Entire District Timaru - Timaru Township Timaru - Timaru Township Timaru - Timaru Township Timaru - Rural Timaru/Temuka/ Geraldine MacKenzie/Waimate - Both Districts Waitaki - Entire District Waitaki - Entire District

Rent Quartile Range

Median Rent 1 Yr 5 Yr Jan-16 Change Change

Median Value Yield 1 Yr 5 Yr Jan-16 Jan-15 Jan-11 Change Change

Jan-16

House

2,503

400 - 460

450

25.0

512,500

0.5

32.6

4.6

-0.5

-5.7

House

1,637

478 - 550

500

-9.1

7.5

638,450

2.2

33.9

4.1

-11.0

-19.7

House House

3 4

2,003 1,074

48 15

415 - 462 480 - 567

437 500

0.5 -8.3

23.1 31.6

487,450 679,100

-2.1 2.2

31.1 33.1

4.7 3.8

2.6 -10.3

-6.1 -1.1

House

536

355 - 415

399

1.8

35.3

429,850

0.3

48.7

4.8

1.5

-9.0

House

2,770

412 - 472

439

-2.4

25.4

481,150

0.6

41.3

4.7

-3.0

-11.2

House

4,333

400 - 460

430

26.5

456,100

2.7

41.1

4.9

-2.6

-10.4

House

2,236

492 - 605

560

-2.9

16.7

648,650

1.7

12.8

4.5

-4.6

3.4

House

1,670

320 - 400

370

5.7

48.0

375,450

0.6

24.9

5.1

18.5

House

6,300

400 - 470

450

9.8

32.4

461,000

-1.3

33.1

5.1

11.2

-0.5

House

6,561

487 - 570

525

5.0

25.0

615,750

-0.6

25.7

4.4

5.6

-0.5

Flat House House House Flat House House

2 2 3 4 2 2 3

841 1,137 4,477 1,623 1,085 1,385 5,583

21 22 91 27 37 42 69

263 - 292 280 - 320 320 - 360 350 - 437 178 - 250 260 - 290 300 - 350

280 290 350 375 220 280 330

3.6 -6.3 -4.3 2.9 3.1

27.3 20.8 22.8 17.2 25.7 27.3 32.0

242,650 284,750 354,400 476,800 234,750 266,400 313,600

2.5 11.2 11.1 5.5 4.0 6.5 1.8

34.5 30.9 38.1 26.0 30.3 34.6 32.4

6.0 5.3 5.1 4.1 4.9 5.5 5.5

-2.5 -6.9 -10.0 -11.2 -8.0 -3.3 1.3

-5.4 -7.7 -11.1 -7.0 -3.6 -5.5 -0.3

House

2,515

280 - 330

300

7.1

25.0

306,200

5.3

18.9

5.1

1.7

5.1

House

2,174

230 - 281

250

4.2

25.0

292,700

10.6

31.4

4.4

-5.8

-4.9

House House

2 3

1,305 4,379

20 48

205 - 255 262 - 290

230 277

-0.9 6.5

9.5 19.4

187,750 225,950

2.9 4.3

11.9 8.0

6.4 6.4

-3.7 2.2

-2.1 10.6

House House House House

2 3 3 4

947 4,037 2,253 1,644

13 56 67 38

257 - 292 300 - 350 400 - 500 480 - 650

280 320 450 540

12.0 6.7 -4.3 8.7

36.6 23.1 18.4 20.0

286,500 367,250 716,000 940,300

16.0 15.2 16.8 15.3

22.7 22.8 45.6 35.8

5.1 4.5 3.3 3.0

-3.5 -7.4 -18.0 -5.7

11.3 0.2 -18.7 -11.6

House

2,488

550 - 750

650

18.2

62.5

880,900

13.7

48.3

3.8

4.0

9.6

House

1,929

700 - 900

800

15.9

77.8

1,181,000

27.5

49.7

3.5

-9.1

18.8

House

2,640

322 - 380

350

11.1

19.9

349,500

13.9

28.6

5.2

-2.5

-6.8

House

1,978

340 - 380

350

9.4

16.7

293,950

5.7

9.2

6.2

3.5

6.8

House

1,200

286 - 327

300

-3.8

9.1

260,050

8.1

16.2

6.0

-11.1

-6.1

House

2,633

320 - 380

360

9.1

33.3

314,650

10.4

15.7

5.9

-1.2

15.3

House

1,964

302 - 360

330

11.9

13.8

272,750

7.7

19.1

6.3

3.8

-4.5

House

2,619

302 - 348

340

3.0

15.3

311,350

7.0

17.4

5.7

-3.7

-1.8

House

2,591

317 - 362

340

3.0

13.3

362,700

13.6

26.0

4.9

-9.3

-10.0

OTAGO Central Otago - Entire District Central Otago - Entire District Queenstown Lakes - Wanaka Queenstown Lakes - Wanaka Queenstown Lakes Queenstown/Frankton/Arrowtown Queenstown Lakes Queenstown/Frankton/Arrowtown Dunedin - Musselburgh/ Vauxhall/Peninsula Dunedin - Kew/St Clair/St Kilda East Dunedin - North East Valley/Pinehill Dunedin - Glenleith/Roslyn/ Belleknowles Dunedin - Kenmure/Mornington Dunedin - Sunnyvale/ Abbotsford/Burnside Dunedin - Mosgiel

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SOUTHLAND Clutha/Southland - Both Districts Clutha/Southland - Both Districts Clutha/Southland - Both Districts Gore - Entire District Invercargill - Central Invercargill/Bluff Invercargill - Central Invercargill/Bluff Invercargill - Suburbs Invercargill - Suburbs Invercargill - Suburbs Invercargill - Suburbs

House

2,013

161 - 210

180

-6.7

5.9

160,350

0.9

6.4

5.8

-7.6

-0.5

House

7,107

200 - 263

240

14.3

20.0

178,150

-11.0

-10.6

7.0

28.5

34.2

House

1,949

220 - 293

260

-1.9

13.0

274,000

-1.4

8.5

4.9

-0.5

4.2

House

2,539

180 - 247

220

2.3

18.9

174,150

-0.3

10.7

6.6

2.6

7.4

Flat

667

170 - 205

180

2.9

12.5

144,900

4.4

0.3

6.5

-1.4

12.2

House

2,684

220 - 297

255

6.3

15.9

184,950

10.0

9.2

7.2

-3.4

6.1

Flat House House House

2 2 3 4

1,095 1,011 9,173 2,348

17 30 148 20

178 - 228 220 - 260 240 - 280 272 - 330

200 250 260 292

1.5 8.7 3.2 -1.0

5.3 25.0 10.6 7.4

200,950 208,850 216,350 343700

15.4 8.6 10.0 12.4

14.5 2.2 12.3 11.4

5.2 6.2 6.2 4.4

-12.0 0.1 -6.2 -12.0

-8.0 22.3 -1.5 -3.6

Who is CoreLogic? CoreLogic is a leading property information, analytics and services provider in the United States, Australia and New Zealand. Bringing together leading property intelligence and geospatial companies, PropertyIQ and Terralink International, CoreLogic NZ helps clients identify and manage growth opportunities, improve performance and mitigate risk. CoreLogic NZ provides clients with innovative, technology-based services as well as access to rich data and analytics.

NZ PROPERTY INVESTOR // AUGUST 2016

SUPPLIED BY REINZ

NATIONAL MEDIAN SALE PRICE MOVEMENT

+25% change no change

This map represents change in the median sale price between the months of June 2015 and June 2016, based on ﬁgures from the Real Estate Institute of New Zealand.

-25% change

SALES SNAPSHOT

Median sales prices are based on June 2016 JUNE 2016

MEDIAN SALE PRICE

SALES NUMBER OF VS LAST SALES YEAR

DAYS TO SELL

DAYS VS LAST YEAR

1 YR

MEDIAN SALE % CHANGE 5 YR 10 YR

NORTHLAND Dargaville Borough

$203,500

Hokianga

$157,250

Kaikohe

$135,000

Kaitaia & Far North

$180,000

Kawakawa

$215,500

Kerikeri

$506,500

Mangonui

$312,000

Otamatea County

$533,500

Paihia Russell

UP NO CHANGE UP

DOWN

16%

105

75%

31%

14% -

124

11%

-39%

DOWN

33%

-25%

178

27%

25%

DOWN

-4%

28%

10%

UP NO CHANGE DOWN

176

-4%

-16%

15%

61%

87%

$330,000

172

21%

-7%

-11%

$550,000

102

DOWN

32%

-4%

-41%

Whangarei City

$351,500

116

DOWN

26%

21%

35%

Whangarei County

$535,000

DOWN

23%

52%

29%

Whangaroa/Kaeo

$162,500

225

-21%

Albany District

$1,248,000

DOWN

19%

102%

126%

Birkenhead Area

$1,152,500

DOWN

15%

120%

153%

$498,000

328

-6%

88%

49%

Devonport Area

$1,270,000

DOWN

-7%

64%

97%

East Coast Bays

$1,112,000

157

DOWN

16%

95%

116%

Eastern Beaches

$1,100,000

163

DOWN

19%

95%

128%

Eastern Suburbs

11%

73%

129%

-5%

110%

169%

AUCKLAND

City / Pt Chev

$1,475,000

158

DOWN

Ellerslie / Panmure

$886,500

DOWN

DOWN NO CHANGE NO CHANGE UP

Franklin County

$600,000

104

DOWN

15%

56%

86%

Glen Eden Area

$691,000

11%

91%

123%

Glenﬁeld Area

$834,500

100

10%

101%

130%

Henderson Area

$791,000

218

DOWN

16%

104%

134%

Hibiscus Coast

$897,000

149

DOWN

21%

99%

100%

Islands Of Gulf

$780,000

UP NO CHANGE DOWN

49%

79%

Manukau Rural

$598,500

DOWN

53%

56%

Manurewa Area

$602,000

162

DOWN

13%

88%

106%

Milford/Takapuna

$1,440,000

DOWN

116%

140%

$1,230,500

DOWN

19%

112%

166%

Mount Roskill Area

$1,030,000

101

DOWN

UP NO CHANGE DOWN

41%

Mount Albert Area

17%

110%

144%

Mt Eden / Epsom

$1,350,000

DOWN

110%

131%

$715,000

101

-8%

77%

109%

Onehunga / Penrose

WWW.PROPERTYINVESTOR.CO.NZ

// NZ PROPERTY INVESTOR

STATISTICS SALES: JUNE 2016 JUNE 2016

MEDIAN SALE PRICE

SALES NUMBER OF VS LAST SALES YEAR

Papakura Area

$674,131

DOWN

Papatoetoe Area

$723,000

207

DAYS VS LAST YEAR NO CHANGE UP

Rodney North

$834,000

Titirangi Area

$887,500

DOWN

Upper Harbour

$940,000

$1,080,000

Hamilton City

DAYS TO SELL

1 YR

MEDIAN SALE % CHANGE 5 YR 10 YR

101%

111%

18%

104%

145%

DOWN

45%

90%

128%

11%

74%

113%

DOWN

104%

88%

DOWN

110%

46%

196%

$485,000

341

DOWN

30%

54%

62%

King Country

$147,550

NO CHANGE DOWN

-1%

68%

-12%

Mount Maunganui/Papamoa

$697,500

121

41%

66%

77%

Rotorua

$285,000

179

DOWN

11%

40%

Taupo

$372,500

DOWN

10%

24%

18%

Tauranga

$556,750

168

DOWN

34%

59%

Thames / Coromandel

$470,000

DOWN

31%

25%

34%

Waikato Country

$356,500

266

DOWN

39%

33%

60%

Gisborne City

$248,500

Gisborne Country

$185,000

Hastings City

$316,600

106

Hawkes Bay Country

$214,500

Napier City

$340,000

105

UP NO CHANGE UP NO CHANGE UP

Waipawa Area

$179,000

Waipukurau Area

$205,000

Dannevirke Borough

$158,000

Feilding

$275,000

Levin

Waitakeres

WAIKATO / BAY OF PLENTY

HAWKES BAY / GISBORNE 27

DOWN

27%

-14%

24%

DOWN

-37%

147%

168%

DOWN

24%

25%

129

-4%

-34%

DOWN

21%

19%

DOWN

-25%

43%

-19%

DOWN

-4%

28%

-2%

DOWN

13%

17%

37%

DOWN

12%

38%

$226,500

DOWN

20%

15%

25%

Manawatu Country

$227,500

DOWN

12%

11%

22%

Pahiatua

$159,500

30%

Palmerston North City

$325,500

122

DOWN

12%

16%

35%

Wanganui City

$166,000

DOWN

-6%

-4%

Waverley

$35,000

DOWN

-45%

-50%

-67%

Bell Block

$502,500

DOWN

35%

32%

86%

Hawera

$230,000

DOWN

-5%

35%

New Plymouth City

$373,500

102

DOWN

31%

41%

Raetihi/Ohakune/Taihape

$143,000

153

DOWN

63%

-39%

-22%

Rangitikei

$161,250

107

DOWN

-7%

36%

Stratford

$200,750

-21%

49%

Taranaki Country

$163,750

DOWN

-38%

-26%

Waitara

$251,000

DOWN

-7%

29%

18%

Wanganui Country

$237,000

DOWN

-24%

-36%

Central Wellington

$476,500

DOWN

21%

32%

16%

Eastern Wellington

$665,500

DOWN

27%

39%

45%

Hutt Valley

$431,500

161

DOWN

21%

36%

40%

Northern Wellington

$592,500

DOWN

23%

36%

55%

Otaki / Paekakariki

$435,000

DOWN

31%

23%

47%

Pukerua Bay / Tawa

$495,000

DOWN

16%

34%

53%

Southern Wellington

$580,000

10%

20%

Upper Hutt

$403,500

DOWN

20%

23%

44%

Wairarapa

$285,000

108

DOWN

33%

44%

47%

Western Wellington

$635,000

DOWN

11%

21%

45%

MANAWATU / WANGANUI

TARANAKI & CENTRAL PLATEAU

WELLINGTON

NZ PROPERTY INVESTOR

AUGUST 2016

JUNE 2016

MEDIAN SALE PRICE

SALES NUMBER OF VS LAST SALES YEAR

DAYS TO SELL

DAYS VS LAST YEAR

1 YR

MEDIAN SALE % CHANGE 5 YR 10 YR

NELSON / TASMAN Motueka

$422,000

DOWN

19%

30%

62%

Nelson

$450,000

DOWN

25%

36%

58%

Nelson Country

$465,000

DOWN

26%

39%

Richmond

$485,050

DOWN NO CHANGE DOWN

DOWN

-5%

38%

45%

Takaka

$405,000

DOWN

42%

62%

Marlborough Sounds

$401,000

249

-52%

25%

-28%

Marlborough/Kaikoura

$339,000

NO CHANGE UP

DOWN

18%

24%

26%

MARLBOROUGH

CANTERBURY Banks Peninsula (East Of Motukarara)

$495,000

192

76%

Canterbury Country(W&S)

$513,000

DOWN

-1%

36%

57%

Christchurch: Addington/SomerďŹ eld/Spreydon

$410,000

-1%

37%

58%

Christchurch: Aranui/Bexley/Bronley/Linwood Christchurch: Avondale/Avonside/Burwood/ Parklands Christchurch: Avonhead

$305,000

DOWN

12%

49%

39%

$361,000

DOWN

-2%

-21%

24%

$580,000

DOWN

66%

68%

Christchurch: Beckenham/St Martins Christchurch: Belfast/Bishopdale/Papanui/ Redwood Christchurch: Brynd/Burnside/Wyr

$625,000

DOWN

26%

54%

105%

$450,000

25%

49%

$500,000

DOWN NO CHANGE DOWN

41%

48%

Christchurch: Cashmere/Scarborough/Mt Pleasant

$643,500

DOWN

17%

37%

24%

Christchurch: Central (Inside,4 Avenues)

$403,500

DOWN

16%

-50%

36%

Christchurch: Fendalton/Ilam/Merivale

$689,000

DOWN

-11%

68%

48%

Christchurch: Halswell/Hillmorton/Hoon Hay

$490,000

DOWN

-12%

48%

42%

Christchurch: Heathcote/Opawa/Woolston

$413,501

DOWN

17%

97%

72%

Christchurch: Hornby/Sockburn/Templeton

$425,000

-5%

61%

81%

Christchurch: Lyttelton & Harbour

$510,000

DOWN

135

27%

32%

21%

Christchurch: North Beach-N/S Brighton

$299,250

DOWN

-5%

16%

20%

Christchurch: Redcliffs/Sumner

$603,000

DOWN

21%

Christchurch: Riccarton / Upper Riccarton

$476,000

15%

34%

79%

Christchurch: Richmond/Shirley/St Albans

$405,000

25%

46%

Christchurch: Sydenham/Waltham

$355,529

DOWN

-1%

60%

92%

Kaiapoi

$395,000

DOWN

-8%

18%

48%

Mid Canterbury - Rakaia/Rangitata

$366,000

DOWN

56%

54%

North & West of Waimakariri

$421,500

36%

53%

Rangiora

$475,000

DOWN

58%

South Canterbury - below Rangitata River

$265,000

31%

66%

Timaru

$322,000

DOWN

38%

49%

$180,000

-26%

-16%

10% 37%

WEST COAST West Coast

OTAGO Central Otago

$468,500

DOWN

27%

36%

Dunedin City

$320,000

187

DOWN

12%

36%

28%

East Otago

$350,000

DOWN

115

39%

62%

100%

North Otago

$250,750

DOWN

32%

42%

52%

Queenstown

$854,500

DOWN

26%

60%

62%

South Otago

$148,000

DOWN

20%

-18%

-41%

14%

12%

DOWN

-33%

-12%

25% 40%

SOUTHLAND Bluff

$136,500

Gore

$139,000

Invercargill

$202,500

131

UP NO CHANGE UP

DOWN

-1%

Riverton

$157,500

145

-48%

-23%

54%

Te Anau

$222,500

482

51%

-13%

Winton

$298,250

DOWN

17%

53%

86%

$500,000

7864

DOWN

11%

39%

61%

NEW ZEALAND NEW ZEALAND Total

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// NZ PROPERTY INVESTOR

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BOOK STORE www.intelligentinvestor.co.nz AUTHOR OF THE MONTH

When to buy, when to sell

An entrée into property may have been written for the Australian market, but it has relevance for Kiwis, writes Phil Campbell

BETWEEN THE COVERS, THREADED INTO EACH CHAPTER, ARE MANY GEMS BASED ON PERSONAL AND ANECDOTAL EXPERIENCE

Unlocking the Property Market (The 7 ways to Property Investment Success) by John Lindeman. This Australian book is also a lesson for New Zealand property investors, or those eyeing a spin in real estate. Selling, buying, market mores and when and how to invest are as pertinent in this country as they are in a book ostensibly published for the Australian market. The principles are the same; the beauty of Lindeman’s tome is the way in which he advises his readers of a more pragmatic approach. Don’t rush into property, seems his overall message. His seven keys are in fact the seven chapters in this book, ranging from understanding how the market works,

to discovering where and when to buy to knowing the best time to sell. Between the covers, threaded into each chapter, are many gems based on personal and anecdotal experience. He writes of unforeseen dangers, that high density unit development or new subdivisions can (and do) have different outcomes. He offers ‘walk don’t run’ suggestions; for example, don’t rush, take your time. He outlines how analysts arrive at property estimates, how much the investor should pay, in what areas at understanding land values. Here the dictum of ‘location, location, location’ inherently applies. Most of Lindeman’s advice seems basic, but much of it makes you think again; the beauty is that in tone and syntax it is a book minus self-aggrandisement (which can prove a distraction). Lindeman promotes encouragement. His book is more suggestion than dictum. His easy prose can be easy followed and it is unequivocal. Graphs, which don’t leap out of the page in distraction, interpolate the text to underline points. Overall, an excellent read for anyone starting out in the market and those established for that matter.

visit www.int ell investo igent r.co.nz for deta ils

RRP $2

9.95

This seems to add to a long literary property canon: how diﬀerent from previous works?

This book follows the same theme – that the property market works in predictable ways and investors can benefit from understanding its dynamics.

You write a relaxed style, but make signiﬁcant points. Feedback?

I have invested in the housing market for over 40 years and professionally studied its performance and likely direction for 15 years, so it's like writing about an old friend – it's easy to put into words.

How relevant is this book to the NZ market?

Seems to me a lot of good sense which applies to both sides of the Tasman? The basic dynamics of housing markets are the same everywhere. People create demand for housing, which then flows into rental or purchase demand, but prices and/or rents only move if a surplus or shortage of properties results.

How do you spend or leisure time? Writing and I love cooking.

Recreational sporting interests?

Walking and visiting unexplored parts of the world.

Current reading?

I am reading about the early history of Tasmania – there's many lessons for investors there.

What are you driving? Landrover, Landcruiser.

Family life?

I live with my professional and personal partner Carolyn. I have two grown up children, but no grandchildren yet.

TO BUY A COPY (0 50 063 #00,4503& "5 888 */5&--*(&/5*/7&4503 $0 /;

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AUGUST 2016