In the media a couple of reliable sources confirm rent increases have not risen alot over the last twelve months – so where are the greedy Landlords? Property sales and prices continue to forge ahead with gusto while rents remain static thus widening the gap between sales and rents according to the latest Trade Me Property Rental Index.
Property investors are actively adding rentals to their portfolios. If they can not afford Auckland they buy in the regions. The investors buying in Auckland are being resourceful and digging deep to meet the prerequisite 30% deposit requirement. Forty five percent of new loans for Auckland property went to investors in March.
In the past 12 months rents are up just $20 per week on average in Auckland according to Pedersens Property Management and the average weekly rent of $500 has remained the same for three consecutive months – so where are the greedy landlords?
Our three major cities of Auckland, Wellington and Christchurch have shown a stable rental market and tenants have to be feeling pleased their landlords are acting responsibly. With talk of compulsory meth testing of properties between tenancies an additional expense for the property owner is around the corner if not already here – see this article Drug Transcends All Homes. Landlords will eventually need to pass on expenses like this one to tenants.
Rental yields are continuing to drop and Landlords have seemingly accepted the new norm of lower yields. Some areas of Auckland have yields around 3 percent and in the regions where 10+ percent was readily achievable, yields of 6-7 percent are now acceptable so really where are the greedy landlords?
This blog article was written for PropertyBlogs by Mobilize Mail.