Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Investors Taking Deep Breath, But Property Remains Safe Bet

“We’ll definitely see fewer ‘mum and dad’ landlords enter the market with minimum deposits lifting to 40% for investors from 1 May. It’s a shame because many of them make great landlords who build strong relationships with their tenants,” says Derryn Mayne, Owner of Century 21 New Zealand.

Like others, the real estate boss says residential investors are taking a deep breath following the Government’s March housing announcements. Interest tax deductibility was wiped for investors and the bright-line test was extended to 10 years - taxing capital gains.

This week Tony Alexander’s Mortgage Advisers Survey reported more brokers ‘are seeing less business come through the door from first-home buyers’. At the same time, the survey revealed less investors are seeking mortgage advice, concluding that policy changes aimed at dampening investor demand for existing properties were having the desired result.

Ms Mayne says many of Century 21’s franchises nationwide, which oversee large property management portfolios, are reporting the Residential Tenancies Amendment Act 2020, which took effect in February, is also having an impact on investor decision-making.

“Not only is it harder to get into residential investment property, but there are many new challenges for existing landlords. Subsequently, we’re seeing small and large landlords exiting out of residential property. They’re opting instead to invest in the likes of the sharemarket, managed funds, commercial property, or even syndications promising a reasonable yield on commercial buildings,” she says.

Despite government and Reserve Bank measures to cool off investors, the Century 21 leader says residential property remains a safe bet for those who factor in that one day the record-low interest rates will inevitably rise.

“If you put money in the bank these days, you’re sadly going backwards. With the best 12-month term deposit rate sitting at barely one percent, when you minus tax and factor in inflation, there’s no income or gain there. Residential property, however, will always provide both.

“With the autumn market seeing some reticence creeping in, for those Kiwis still willing and able to get into investment property, they might be surprised at the opportunities now out there. Let’s not also forget that demand by tenants remains high and rents are still very strong,” says Derryn Mayne.

www.century21.co.nz

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 




Greenpeace: Calls Foul On INEOS Rugby Sponsorship Deal

Greenpeace is calling foul on NZ Rugby’s decision to sign a sponsorship deal with the oil and plastic polluting petrochemical giant INEOS. "In the thick of the climate crisis, it’s gutting to see NZ Rugby sign a sponsorship deal with an oil and gas polluting conglomerate... More>>



Stats NZ: Quarterly Inflation Rising Steadily Across The Board

Higher prices for transport and food have driven up inflation for the all households group in the June 2021 quarter, Stats NZ said today. The ‘all households group’ represents all private New Zealand-resident households... More>>


Stats NZ: Primary Products Push Exports To A New High

New Zealand exports reached a new high in June 2021, off the back of record export values for logs and beef, Stats NZ said today. In June 2021, the value of all goods exports rose... More>>


Real Estate: June Home Transfers Remain High
There were 44,517 home transfers in the June 2021 quarter, the highest June quarter figure since 2016, Stats NZ said today. The number of home transfers was very similar to the March 2021 quarter and was up 18,252 from the June 2020 quarter... More>>



Statistics: Household Saving Falls In The March 2021 Quarter

Saving by New Zealanders in the March 2021 quarter fell to its lowest level in two years after rising sharply in 2020, Stats NZ said today. Increases in household spending outpaced income growth, leading to a decline in household saving from the elevated levels that prevailed throughout 2020... More>>

ALSO: