As New Zealand sees the general cost of living rise, over the last 12 months rents across our portfolio have also increased by 6%. Reasons for this include low supply numbers and increased demand levels, two trends I have noted extensively in past blogs. And with the building materials shortages across the country, it may be hard to remedy supply in the short-term.
Compounding the situation is the fact that tenants are staying in their rental properties for longer and being less transient, although this is a plus for landlords who want to hold onto their great tenants. So with these factors combined, I believe rents will continue to feel upward pressure, likely increasing another 5-6% in the next 12 months.
In my November blog, I noted the guidance from the Privacy Commission around monitoring and compliance for tenant information gathering, designed to ensure everyone in the rental industry acts in accordance with the Privacy Act. Since then, the Commission has noted they are now checking on landlords and property management companies to see how they are operating.
We have adopted the recommended two-step process for collecting tenants’ information and completing property applications, and while this is different to what we are used to, we are confident it won’t create any delays in the leasing of our available properties. Keeping track of legislation like this which affects rental property owners is one of the advantages of working with an experienced property manager, who can keep on top of the law for you.
For the remainder of this month’s blog, I’m going to pivot and look outside of Hamilton’s boundaries, where we are seeing increased demand for rental properties.
Looking beyond Hamilton’s city boundaries
You may or may not know this, but Lodge manages rental properties in several towns surrounding Hamilton including Ngāruawāhia, Morrinsville, Te Awamutu and Cambridge. We are currently seeing heightened tenant demand in these areas, lining up with overall population growth in Waipā which is increasing faster than anticipated.
Our local property manager based in Cambridge, Renee Beard, has reported that any new properties listed are generally leased within a week. This reflects a red hot rental market where, like Hamilton, demand is outstripping supply. This marks an opportunity for landlords looking to expand their portfolios. While Waipā experienced some record high property prices this year, you may still be able to find a good deal as the housing market comes off its peak.
With Lodge’s team of local property managers operating in these areas, we know these smaller community markets better than most. If you would like to talk more about investing in these areas or sign up a new property, do get in touch with myself, Jason or our business development manager Nic – maybe we’ll catch you for a coffee at Paddock!
Until next time,
David Kneebone
Director, Lodge City Rentals