Rental Returns May 2012

[PC]

Anyone see this little graph in the current property mag - page 64?
Nice little trend to be part of.
Almost worth the bashing LLs have been taking.

[TheLiberalLeft]

Absolutely meaningless unless you know what that Y axis is measuring.

Is it Damage Caused by Tenants?

[PC]

Close!
Sorry should show "$ Median Rental Price"
$320 to $346 in $3 increments.
Gotta love stats.

[drelly]

Meh... look at the rent returns for Northland... pretty much flat for the last 5 years.

[north shore]

Did they have a graph for expense increases as well? That would be interesting reading.

[flyernzl]

Initially I though it related to the increasing cost of insurance premiums.
Then I saw the down bit on the right hand end, and knew that couldn't be right.

[Tom]

Hey guys,

I had a very interesting conversation with a PM today (one of the largest PM firms in Auckland). He told me that the rental market in South and West Auckland is the quietest they have seen in years, nothing is moving fast at all and enquiry is extremely low.

This is obviously opposite to what we read about in the media but that is nothing new.

It did take me backn a bit as I was under the impression both areas were still very boyant, but apparently not. Anyone investing in these areas having that expereince?

Cheers

Tom

[flyernzl]

Advertised a downmarket 2brm unit in Manurewa last week.
The Trademe ad got some 50 responses in four days, ended with 15 written applications.
I'd say that's buoyant, for midwinter.

[PC]

I keep an eye on the local rags to-let classifieds.
1 column = under supply.
1 page = normal
2 pages = too much supply.

Has been sitting around 1 to 2 columns for quite some time now.

[Shane D]

Hey guys,

I had a very interesting conversation with a PM today (one of the largest PM firms in Auckland). He told me that the rental market in South and West Auckland is the quietest they have seen in years, nothing is moving fast at all and enquiry is extremely low.

This is obviously opposite to what we read about in the media but that is nothing new.

It did take me backn a bit as I was under the impression both areas were still very boyant, but apparently not. Anyone investing in these areas having that expereince?

Cheers

Tom

My personal experience from 2 recent rental listings of mine in Papatoetoe, South Auckland is the rental market is luke warm only.

Mind you, we did try to price the places on the high side of the market average. We ended up dropping the prices by $10 a week and activity picked up. Moral of the story is pricing your property just right is essential right now in South Auckland to secure a good tenant fast.

I have noticed also that tenants seem to stay long term once they get into one of my Papatoetoe rentals. Then again my property manager is good at picking good tenants that are basically lifelong renters.

Shane

[Tom]

Thanks for your replies guys.

Very interesting. Up until a few days ago I had thought the market was still very strong. This'll be interesting to see what happens. I am not worried as I have no vacancies at all and keep most of my rents either at or slightly below market to attract and keep tenants, but I like to keep a good eye on things and realised I was out-of-touch and thought we were still in rental utopia.

Cheers

Tom

[eri]

in the very localized and student centered central auckland apartment market

rental utopia was about april 2012

when the 416 apartment volt building on queen st. had only 1 vacancy at $410pw

but by june it was back to a more normal 11 vacancies from $350pw and seems to be holding there

http://www.trademe.co.nz/browse/categoryattributesearchresults.aspx?search=1&mcat=0350-5748-&sidebar=1&132=FLAT&selected135=7&selected136=89&134=1&135=7&136=89&153=volt&29=&122=0,0&59=0,0&178=0,0&sidebarSearch_keypresses=0&sidebarSearch_suggested=0&sort_order=price_asc

which is still better than jan 2011 when there were 10 or more vacancies starting at $270pw and the building was awash with mortgagee sales as the guaranteed 2 years rental at $400pw was finished for those who bought off the plan with minimal $5000? deposits in 2007?

[Tom]

Thanks Eri,

I found that to be similar in South Auckkland, the start of the year up until recently has been very strong. Large rent increases and lots of demand. I'm trying to get my head around why that has changed so suddenly. I know it's not a major change but I'd still like to understand why it's happened.

Anyone have any ideas?

Cheers

Tom