Residential - Boom or Bust

[TGB]

Lot's mixed messaging out there, articles comparing Irelands rental market to what nz could become. Other's saying buyers choice.

We have found tenants for the remaining house, now it's just a matter of seeing what the interest rates do as we are using ANZ's blueprint to build floating rate (currently 4.08%).

[Shareguy]

Govt 'disappointed' domestic violence tenancy regulations are long overdue. ACT calls it 'unacceptable'
Rob Stock
The Ministry of Housing and Urban Development has secured a legal opinion that a law allowing victims of domestic violence to break a tenancy to escape an abusive relationship is now in force, despite the Government's failure to pass enabling regulations.

The amendment to the Residential Tenancies Act allowing victims of domestic violence to leave a tenancy with just two days notice was to come into force in August last year, but the Government failed to pass the regulations in time to see that happen.

A year later, it still had not been, which ACT housing spokesperson Brooke van Velden said was unacceptable, calling the Government "too disorganised to get its own house in order".

Housing Minister Megan Woods said she was disappointed the regulations had taken so long, and acknowledged it was frustrating for landlords and people who wanted to use the law to help domestic violence victims.

READ MORE:
* Tenancy law changes: What do they really mean?
* Tenancy law changes a 'step in the right direction'
* Tenancy changes a recipe for trouble

Now, the Ministry of Housing and Urban Development has written to property managers saying it had "received legal advice that the provisions are in effect and can be used, even though the regulations are not yet in force".

[Shareguy]

Unattended consequences are already starting to happen with landlords NOT choosing women, especially solo mums.

A lot of Landlords don't think it's fair that they carry the cost for this.

[Basil]

Lost count of the number of clients over the years who have brought rental properties, put their kids into them and the kid gets into an abusive relationship and the rental property gets trashed.  I am afraid to say more often than not this leads to a heavily strained relationship, the kid moving on and taking their issues with them and the landlord footing a five-figure repair bill.

The socialist leanings of this Government will do nothing to help the rental stock level's.
Hope KPG know what they are in for with high rise built to rent in New Lynn.
This dog has had a couple of apartment rentals in that neck of the woods before and it wasn't a very rewarding experience...no major disaster and we got out before the apartment complex starting leaking but nonetheless a lot of work for very little reward.  I haven't owned a rental property since then and won't.
If you can't get rid of troublesome tenants, why would you bother ?

[arekaywhy]

... a lot of work for very little reward. ...

This exactly, thankfully in my poor experience the tenant had the foresight to keep the laboratory experiments in the garage with no lining

[KW]

Unattended consequences are already starting to happen with landlords NOT choosing women, especially solo mums.

A lot of Landlords don't think it's fair that they carry the cost for this.

Domestic violence is a scourge on all echelons of society, not just the low income ones.  You will never be able to pick it either.  However the big problem with the legislation is that it allows the abuser to stay in the property for 2 weeks rent free every time the abused moves out.  Considering that a woman on average makes 7 attempts to leave before finally doing so, thats 7 periods of free rent you are on the hook for. 

[arekaywhy]

Unattended consequences are already starting to happen with landlords NOT choosing women, especially solo mums.

A lot of Landlords don't think it's fair that they carry the cost for this.

Don't you see it as odd that they continue to vote for the clowns that make this possible?  Baffles me, but hey, maybe they manage to trick half the population with appeal to emotion and feels?

[BlackPeter]

Don't you see it as odd that they continue to vote for the clowns that make this possible?  Baffles me, but hey, maybe they manage to trick half the population with appeal to emotion and feels?

I guess if there are only clowns standing for election, than clowns is what you get, no matter which colour they represent.

Lets not forget that the last National team was absolutely unelectable.

But back to the subject - NZ's rental market and its regulations are shambles, but to be fair, it was all political parties contributing to this mess. Nobody cared to create a framework for a good and stable rental market.

It is not just the landlords who have little protection against bad renters (and yes, these people exist), good renters (and yes, they exist as well) get screwed over again and again, given that it is e.g. very easy for bad landlords (and yes, they do exist as well) to break their contract just by selling a property.

Might be a cultural issue ... in many European countries do good renters live for decades in the same rental accommodation provided by good landlords. Not utopia: I remember my grandparents used to live for more than 50 years in the same rental unit, they paid a fair rent (from memory something like 20% ... 25% of their income), they looked after their unit ... and the landlord (a registered company) made a profit as well. Not by speculating, but by getting a fair return on their investment. 

[arekaywhy]

all excellent points

I cannot help but see that the common denominator is gubmint intervention/meddling

[Hectorplains]

interestings times we are in........I hear in many areas there is a lot more rental supply now.......could we be entering into a period of higher rental loan servicing costs(higher interest rates) and lower rents......why not we have just been through a period with lower loan servicing cost and rising rents

I'd like to hear more of what your thinking is on the current state of the NZ real estate market.  You may remember we disagreed on Fat P about an impending crash.  From which I'd suggest your viewpoint did you very well, and mine allowed mt to say, I got it wrong! 

[snapiti]

simple really, residential realestate prices sky rocketed on the back of low servicing cost(interest rates)........now with climbing interest rates servicing costs of loans is much higher.......of most interest is bank margins are way lower than normal at the moment as they all try to fight for a ever decreasing piece of the mortgage lending pie and to another degree slow the property price correction down. The last time swap rates were this price 2 year mortgage rates were over 7%
Where it all ends up, I suggest will take another 12 months to sort out and will be determined by the reserve bank rate hikes......of course the real fear here is they over correct monetary policy again. 
At least the labour market is strong for now.   

[snapiti]

I was a realestate agent for 10 years, during that time I seen hundreds of rental properties, only ever seen two trashed, quite a rare event.
However it appeared to be a foolish ideology to buy a new house or second hand one and renovate it and rent it out not expecting it to age quickly.

[Shareguy]

Almost 10% of owners said they kept their properties empty intentionally, and one in four ghost homes had been vaccant for at least a year. Says article in stuff today.

Concerning that property owner's would do this? Owners are so worried about having tenants, so would rather leave them empty than have the risk. Secondly a suggestion of some sort of tax to incentivise people to rent the house out seems very communist to me.

I can see this issue getting worse now that it is extremely hard to get rid of bad tenants.  The anti landlord rhetoric this government and some press seems to be championing also does not help.

As a long-term landlord I am already seeing unintended consequences from labours tax and tenancy law changes. Landlords are being very picky in picking Tenants. They are not prepared to take risks and unfortunately rejecting certain groups of people. You also have people that are now reluctant to invest in a rental property.

Given 85% I believe of rental properties are supplied by mum and dad landlords, with majority only owning one property. You would've thought the government of the day would incentivise the private sector instead of making it more difficult.

Thoughts?

[Basil]

I was a realestate agent for 10 years, during that time I seen hundreds of rental properties, only ever seen two trashed, quite a rare event.
However it appeared to be a foolish ideology to buy a new house or second hand one and renovate it and rent it out not expecting it to age quickly.

I've been a bean counter for more than 40 years.  First ten years is just learning.  I have lost count of the number of clients who have had their properties trashed and the number who have faced major water ingress issues.  So many Mum and Dad investors lives have been severely affected.  Now that the prospect for capital gains has vanished and Cindy and her left wing socialists are dictating terms to the point where you genuinely wonder who controls the property, the owner, the tenant or the Government, why would anyone bother ?

I reckon more than half my clients who have bought apartments have had major weather tightness remediation problems.

[arekaywhy]

I don't care how cheap it is, you will never see me buy an apartment.  You will literally be purchasing a money burning machine, with the added bonus of a lesson in the tragedy of the commons