You've seen the media reports about skyrocketing rents and crowds at open viewings. Well, that wave has now crashed on the shore. There's still not a huge selection of properties available, and there's also not a huge number of tenants scrambling to secure a place.
Rents now seem to have stabilised noticeably, and with winter sneaking back in to dampen the spirits, the market have levelled off considerably. If you're smart, you've signed your tenants up for another fixed term tenancy through to Jan/Feb 2019 so that you can easily secure another tenant at the best time of the year.
Remember, the rent figures on the MBIE website are based on historic data and are out of date already. Advertised rent rates on Trade Me are only what landlords are asking for, NOT what they might actually be getting.
What you need to be planning for now is maintenance and upgrading to give yourself the best possible chance of securing good quality tenants, with the added bonus of enhancing the intrinsic value of your rental property. Things like heat pumps, good insulation, double glazing, quality carpet, and interior painting and decorating. Well appointed bathrooms and kitchens are also a sound investment, and adding a carport or garage if possible is really smart. Here's a few other ideas for you.
From my own experience, it's a good idea to include two weeks of vacancy downtime every year in your calculations. That way, if a tenant stays in your rental for a few years, you can calculate how much rent to allocate to improvements like the ones mentioned above. If you rent your place for $400 a week and the tenants stay for four years, you should perhaps consider spending about $3,600 at the next change of tenancy.
managemyproperty is an independent Property Management company based in Wellington, New Zealand.
Richard Horne remains a tireless and energetic investor and commentator, running an experienced eye over the property market. Visit the website at managemyproperty.co.nz