Monthly Landlord Newsletters

Welcome back to the Propertyscouts Monthly Landlord Newsletter, where we update you on all things New Zealand property market, investor insights, seasonal reminders, and more.

One Simple Check for Budding Investors

The other day a young investor gave us a call looking for a bit of a steer. They were eager to get onto the property ladder but said they felt swamped by all the listings out there and weren’t sure how to tell the good ones from the lemons. We talked for a while and covered plenty of ground, but one of the key things we showed them was how to quickly assess gross yield. It’s simply the relationship between the rent and the purchase price - you work it out by taking the annual rent, dividing it by the purchase price and multiplying by 100 to get a percentage.

As a rule of thumb, if you’re fully debt funding the purchase (based on today’s short-term interest rates):

• At 6.5% or above, the property should just about wash its own face.

• Around 6% and the yield is marginal - it could go either way depending on expenses.

• Anything under that and you should expect to top it up each week.

That said, don’t expect to see too many properties at those levels. With house price growth over the years it’s getting harder to find rentals that are cash flow positive right off the bat. The real trick is buying something with room to add value, lift the rent and improve the gross return over time.

So for all of you out there thinking about your next purchase, this little check might come in handy too.

Strong Results in Healthy Homes Awards

At Propertyscouts we often say integrity is about doing the right thing when no one is looking. Well, it turns out someone was looking - Tenancy Practice Service (TPS), who provide software to much of the property management industry. 

Earlier this year TPS carried out an audit of Healthy Homes compliance across property management offices nationwide. The results are in, and we’re proud to say Propertyscouts offices stacked up very well. Out of 900+ offices around New Zealand, 10 of our 24 franchises made the Top 10 in their regions, and a few even went all the way to the top:

Propertyscouts New Plymouth - Healthy Homes Compliance Excellence Award (Winner)

Propertyscouts Invercargill - Healthy Homes Compliance Excellence Award (Winner)

Plus Christchurch, Hamilton, Hutt Valley, Greater Wellington, Hawkes Bay, Christchurch Metro, Nelson, and Central Otago all placed in their regional Top 10.

Healthy Homes compliance is one of the biggest regulatory changes landlords have faced in recent years. Seeing so many of our offices recognised confirms the effort that’s gone into making sure our landlords are supported every step of the way.

Quote to Ponder

“In the middle of every difficulty lies opportunity.” – Albert Einstein

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Disclaimer

Given the opinions expressed in parts of the email, it’s important that we make it clear that the contents are opinions and observations and made in good faith.  

Propertyscouts NZ (2020) Limited, trading as Propertyscouts, and its associated parties (including directors, agents, employees, officers or otherwise) have attempted to provide   this information to the best of their ability but do not make any representations or warranties of any nature (intended or implied) as to the accuracy of the information on this communication. All recipients of this communication should conduct and rely on their own enquiries in relation to the information on this communication.

The information available on the properties listed for sale, rent or otherwise, has been obtained from the vendor or landlord of the property and the appropriate professional service providers. We do not and cannot verify or guarantee the accuracy of the information obtained in relation to the properties.

The information and/or materials available in this communication are intended to be general information only and may be changed at any time, without notice to you. The information and/or materials in this communication should not be relied on under any circumstances as a substitute for legal, financial, real estate, or other professional and/or expert advice. To the maximum extent permitted by law, Propertyscouts and its associated parties disclaim all liability, responsibility, and negligence for any direct or indirect loss or damage suffered by any person arising from the information and/or materials presented in this communication or any information and/or materials that arise from it.