Well we’ve made it – the end of 2021 is here. I think we’d all agree the year took some twists and turns we weren’t expecting, but at Lodge City Rentals we feel we’re finishing the year on a high. Our team are busier than ever with the summer rush, as many prepare for 2022 early to allow for a relaxing summer break.
It’s also been ‘all go’ over the past month due to our transition from alert level three to level two and now to the orange traffic light setting, and we thank our clients for their patience and support during this time.
It’s hard not to feel reflective at the end of another year, as it certainly feels like a lot has happened – even if you can’t remember it all! At the start of the year we put a few predictions down on paper, so in this blog I’ll look to revisit those along with the big stories for the year.
Don’t ask me about the forecast for 2022 though – I think this year has proven that specific predictions are a risky business, so I’ll stick with looking at the more general outlook.
Way back in January…
At the start of the year we were preparing for the Residential Tenancies Amendment (RTA) Act changes that came into force on February 11, which covered security of tenure, changes to fixed term tenancies, the ability to make minor property changes, fibre broadband, landlord records and enforcement changes around the Tenancy Tribunal.
We did and still do believe the legislation looks evenly upon both parties, tenants and landlords, and since then have seamlessly integrated the changes into our day-to-day operations.
I also threw out some predictions for 2021, noting that the rental market was likely to continue on its current trajectory with no major upheavals. I would say that has been the case, as the only solution to shifting the enquiries vs. properties tenanted statistics we share is more supply to outweigh the demand. With the many developments around Hamilton, that is certainly in-train but we aren’t there yet.
We also felt the next area due for a legislative focus would be the regulation of the property management industry, which hasn’t yet eventuated despite some rumblings from various politicians.
A year of legislation and regulation
As well as the RTA changes, we’ve seen loan-to-value ratios (LVRs) return, set at 40% for investors since May. Since then, November 1 saw the Reserve Bank step things up so that banks are only able to lend 10% of new loans, instead of the current 20%, to owner-occupiers with deposits of less than 20%.
April saw the introduction of the Government’s housing package which extended the bright-line test and removed the ability for investors to offset their interest expenses against their rental income. More details came through on this in September, and with the exemption for new builds we discussed the phenomenon of investors rotating their portfolios, swapping out existing properties for new builds that comply with the Healthy Homes standards.
On that note, July saw another Healthy Homes deadline pass, so that all new tenancies must now comply with the standards.
The one other recent legislative update relates to the Resource Management Act (RMA) and the housing density changes. Since the bi-partisan announcement, Hamilton City Council has come out against the proposal, so it will be interesting to see how this one progresses over 2022.
Hamilton: City of the future
While ‘Hamiltron’ may make some cringe (including myself), Hamilton continues to grow as a city for the future, both upwards and outwards. We’re seeing the CBD revitalised, and major new housing developments getting underway or nearing completion. It will be exciting to see what the city looks like in five or ten years, and as a property investor I think there are plenty of opportunities, including buying off the plans and smaller developments like duplexes.
2021 highlight: Our client relationships
What has been a real highlight for our team over the past year is working with our clients to look after and protect your properties, ensuring great outcomes for both landlord and tenant. We pride ourselves on being up-to-date with all legislation and diligent property managers, so it’s heartening when we receive comments about how we are a ‘top-class team.’
Many of our property managers have years-long relationships with their landlords and tenants, and its these relationships that keep the wheels turning and build a high level of trust.
With that, I will sign off for the year. From the Lodge City Rentals team, we wish you a merry Christmas and a restful start to the new year. If you do need anything over the summer break, our offices remain open except for the statutory holidays. We look forward to working with you in 2022.