In the months since New Zealand came out of lockdown, new and would-be landlords are flooding Barfoot & Thompson’s property management division with enquiries.
Samantha Arnold, general manager, property management, says that there has been at least a 40 per cent increase in requests for properties to be managed.
“It is mainly from landlords who have one investment property and are about to purchase another,” Arnold says. “And there’s real growth from new landlords especially in Manukau and West Auckland.”
Arnold had heard commentators insist that landlords were quitting the investment market as they didn’t want to spend money to meet rule changes brought by this year’s Healthy Homes regulations and the new Residential Tenancies Amendment Act that came into effect last month.
Start your property search
But that is not what the company is hearing from landlords for the over 17,500 – and growing – properties it has under management around Auckland and Northland.
“The market keeps going. Because of the changes, landlords are going to need` help. But landlords are also a bit more sophisticated, they use property managers to take all the hassle away. The guidelines from MBIE alone now run to 14 pages.”
Samantha Arnold, general manager of Barfoot & Thompson's property management division says that investors are not pulling out of owning rental properties. Photo / supplied
Arnold says that the company runs workshops for new and would-be investors, and she is seeing more investors who are keen to take advantage of the low mortgage rates.
Despite the competition driving up the price of investment-level properties, she says that yields are going up as rents increase and the cost of borrowing drops. This can only improve over time.
“The equity and rent will increase, putting you in an even better position to grow your portfolio.
“There are also ways to structure your investment to legally minimise your tax payments, expenses and depreciation.”
As well as day to day rent and tenant management, Arnold says that experienced property managers can advise landlords on how to protect their investment and get the best possible returns.
“We’re advising buyers now to look for solid homes – brick is popular – that are low maintenance, and already have the insulation, smoke alarms and heating that new regulations require, so you don’t have to spend the money when you buy a new property.
“Properties near public transport and close to schools get better yields. A recent survey of tenants suggests that people are willing to pay a bit more for properties that have more storage or that allow pets, so owners could take this into consideration when renting their properties out.”
Arnold said that while more experienced landlords know how to add value to a property by adding bedrooms, demand is now rising for just two-bedroom places (“with extra space for a study or working remotely, even better”).
