Rental Income Growth Moderate

forrentRental income growth is moving at a much slower pace than property value growth throughout New Zealand. This is actually a relief too. Imagine rents growing at 15 percent per annum? I know ‘a dream come true’ for Landlords well until tenants fail to pay the rent or fixed tenancies becomes a thing of the past.

Trade Me Rent Price Index for April 2015 confirmed Auckland’s rents have grown 6.3 percent since April 2014 while property values based on recent sales have grown more than 16% for the same period.

The recently announced restrictions on property investors and properties in Auckland have yet to flow through to rents. It may be months before any impact is known however Auckland rents could see a sharper rise in growth during the next 12 months.

There will be some landlords gunning for double digit rental income as soon as possible however most landlords will keep the increases moderate. Tenants do have a ceiling. Most tenants will be on a fixed income and landlords pushing the rent increases too far may end up without a tenant!

Now’s the time for proactive property managers to advise their landlord clients of the rental income threshold. Their role is to ensure their landlords’ investments are getting the best returns possible and that it’s a win win for both parties (landlord and tenants).

Pedersens Property Management manage rental properties throughout Auckland and the North Shore as well as their own rental portfolio. They were named the best property management company in New Zealand last year – was it their systems, experience, or service? Probably all three.

This blog article was written for PropertyBlogs by Mobilize Mail.

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