THE WEST AUCKLAND RESIDENTIAL LANDLORD NEWSLETTER No. 17

Hello,        

Welcome to the seventeenth edition of the West Auckland monthly Residential Landlords Newsletter.

I am a landlord myself and have been for over 30 years. I currently own rental properties in South Auckland, the North Shore and of course West Auckland. Being a high preforming Real Estate Agent (top 1% in New Zealand) for over 26 years and always working in West Auckland I know the real estate market and the rental market very well.  

In this and future newsletters I hope to provide ongoing up to date information relevant to landlords who own rental properties in West Auckland.  

Regular features will include: 

·         Current sale prices

·         Current mortgage rates

·         Current rents

·         A monthly suburb spotlight review

·         A relevant feature article each month 

I hope you will find it useful. I am available for free advice and opinion on any residential or lifestyle real estate matter.      

	Sale Prices
Suburb	Median selling price Dec 2015	No sold	Days to sell
Titirangi	$822,000	27	38
Laingholm	$685,000	7	27
West Harbour	$837,500	22	31
Glendene	$674,000	11	28
Henderson	$655,000	64	35
Hobsonville	$840,000	9	37
Massey	$632,500	37	30
Ranui	$640,000	15	27
Sunnyvale	$740,000	14	30
Te Atatu Peninsula	$762,000	15	30
Te Atatu South	$742,500	14	33
Waiatarua	$507,000	4	24
Glen Eden	$680,000	23	27
New Lynn	$722,000	20	28
Kelston	$614,000	4	14

 

                                                       Source REINZ

Current Mortgage Rates (23/01/2016)
	Float	1 yr fixed	2 yr fixed	3 yr fixed	5 yr fixed
ANZ	5.74%	4.39%	4.49%	5.10%	5.35%
ASB	5.75%	4.39%	4.49%	4.75%	5.25%
BNZ	5.85%	4.39%	4.39%	4.49%	5.50%
Westpac	5.85%	4.39%	4.39%	4.65%	5.35%
Kiwi Bank	5.65%	4.49%	4.49%	4.85%	5.35%
Best of other lenders	5.59%	4.25%	4.35%	4.49%	4.99%

Source – J Goodrum – Internet search

 

 

Current Rents
1st July - 31st Dec 15
Glen Eden	Average Rent	Bonds Paid	Ranui
2 brm apartment	$286.00	5	2 brm flat	$330.00	6
2 brm flat	$350.00	12	2 brm house	$375.00	8
2 brm house	$375.00	25	3 brm house	$440.00	78
3 brm house	$450.00	126	4 brm house	$500.00	10
4 brm house	$550.00	23	Royal Heights/Massey
5+ brm house	$495.00	5	1 brm flat	$320.00	7
Glendene			2 brm flat	$362.00	12
1 brm flat	$285.00	8	2 brm house	$382.00	26
2 brm flat	$375.00	14	3 brm house	$450.00	138
2 brm house	$390.00	20	4 brm house	$535.00	36
3 brm house	$460.00	56	5+ brm house	$605.00	20
4 brm house	$550.00	13	Te Atatu South
5+ brm house	$680.00	5	1 brm flat	$270.00	5
Henderson			2 brm flat	$375.00	11
1 brm apartment	$315.00	5	2 brm house	$395.00	23
2 brm apartment	$380.00	6	3 brm house	$467.00	46
1 brm flat	$297.00	12	4 brm house	$550.00	17
2 brm flat	$370.00	53	Te Atatu Peninsula
3 brm flat	$350.00	7	2 brm apartment	$450.00	5
1 brm house	$325.00	10	1 brm flat	$315.00	6
2 brm house	$395.00	59	2 brm flat	$372.00	10
3 brm house	$450.00	225	2 brm house	$400.00	19
4 brm house	$560.00	75	3 brm house	$490.00	85
5+ brm house	$600.00	22	4 brm house	$585.00	16
Kelston			Titirangi
1 brm apartment	$290.00	23	1 brm flat	$295.00	18
1 brm flat	$285.00	17	2 brm flat	$380.00	11
2 brm flat	$320.00	15	1 brm house	$330.00	5
1 brm house	$315.00	6	2 brm house	$400.00	30
2 brm house	$375.00	10	3 brm house	$520.00	58
3 brm house	$460.00	73	4 brm house	$592.00	22
4 brm house	$510.00	16	5+ brm house	$650.00	6
New Lynn			West Harbour
1 brm apartment	$320.00	20	1 brm flat	$300.00	9
2 brm apartment	$385.00	9	2 brm house	$400.00	17
1 brm flat	$300.00	15	3 brm house	$495.00	85
2 brm flat	$380.00	47	4 brm house	$600.00	37
3 brm flat	$445.00	10	5+ brm house	$730.00	13
1 brm house	$320.00	7	Western Beaches/Rural
2 brm house	$400.00	38	1 brm flat	$287.00	8
3 brm house	$475.00	87	1 brm house	$370.00	7
4 brm house	$530.00	11	2 brm house	$380.00	47
5+ brm house	$660.00	6	3 brm house	$472.00	60
			4 brm house	$500.00	17
			5+ brm house	$600.00	5

Source NZ Government building & housing

 

Spotlight on capital gains
Green Bay
Date	Median selling price	5 year gain %
Dec 1995	$180,000.00	-
Dec 2000	$260,000.00	44.4%
Dec 2005	$275,000.00	5.8%
Dec 2010	$382,750.00	39.2%
Dec 2015	$807,500.00	111.0%
Over 20 years		348.6%
Spotlight on capital gains
Kelston
Date	Median selling price	5 year gain %
Dec 1995	$152,000.00	-
Dec 2000	$201,500.00	32.6%
Dec 2005	$272,000.00	35.0%
Dec 2010	$328,750.00	20.9%
Dec 2015	$614,000.00	86.8%
Over 20 years		304.0%

Source NZ department of statistics

 

Rental Property Investments in West Auckland – Where to in 2016?

In my 3^rd West Auckland Residential Landlords Newsletter back in June 2014 I wrote that house prices would go up and so would rents. I also said that prices typically doubled roughly every 10 years but said it may be more this time.  

Well that certainly proved to be correct so far. The capital gains in West Auckland since June 2014 and that is only 1 ½ years ago remember have been as follows: 

Suburb	Median Selling Price June 2014	Median Selling Price Dec 2015	Capital Gain
Hobsonville	$524,450.00	$840,000.00	60.20%
West Harbour	$705,000.00	$837,000.00	18.70%
Glendene	$521,250.00	$674,000.00	29.30%
Henderson	$528,000.00	$655,000.00	24.10%
Massey	$465,000.00	$632,500.00	36.00%
Ranui	$453,750.00	$640,000.00	41.00%
Sunnyvale	$438,675.00	$740,000.00	68.70%
Swanson	$524,000.00	$700,000.00	33.60%
Te Atatu Peninsula	$616,250.00	$762,000.00	23.70%
Te Atatu South	$518,500.00	$742,500.00	43.20%
Glen Eden	$455,000.00	$680,000.00	49.50%
Kelston	$480,000.00	$614,000.00	27.90%
New Lynn	$536,000.00	$722,000.00	34.70%
Green Bay	$745,000.00	$807,500.00	8.40%
Titirangi	$613,500.00	$822,000.00	34.00%
Waitakere City	$525,500.00	$717,500.00	36.50%

Back then in June 2014 I was saying that the main drivers of price increase was supply and demand. 18 months later the supply of homes in Auckland is worse than it was (a bigger shortage now) back then and the demand situation has grown larger. In June 2014 we had a net migration gain of 38,000 to NZ. In December 2015 that has grown to a net gain of 64,000. Most will settle in Auckland.

Add to that the fall in interest rates from 6.0 – 6.1% (1 year fixed) in June 2014 to rates of 4.4 – 4.5% in December 2015 and it is pretty clear that prices are going to rise again this year. So ignore the “bubble is about to burst”, a “correction is due” and “the Auckland housing market is overheated” comments from those who sit remote from the market and what is really happening.

I don’t think we will see a 22% rise in West Auckland like last year. I predict between 12 – 16% increase between January and December 2016. What about rents? They went up too:

 

Larger West Auckland Suburbs	June 2014 average rent p.w     3 bedroom house	December 2015 average rent p.w 3 bedroom house	Increase $	Increase %
Glen Eden	$411.00	$450.00	$39.00	9.50%
Henderson	$428.00	$450.00	$22.00	5.10%
New Lynn	$439.00	$475.00	$36.00	8.20%
Te Atatu South	$448.00	$467.00	$19.00	4.20%
Te Atatu Peninsula	$454.00	$490.00	$36.00	7.90%
Titirangi	$475.00	$520.00	$45.00	9.50%
West Harbour	$449.00	$495.00	$46.00	10.30%
Waitakere City	$443.00	$478.00	$35.00	7.90%

 

In NZ the economy is strong, employment levels are high, net migration is growing and interest rates are lower than they have been since the 1950’s. EL Nino predictions for this year which would have reduced our agricultural output have been modified such that the effect on the economy is now predicted to be less severe than earlier thought.

Even the pessimists would have to admit NZ Incorporated is looking very healthy. The net result of all this? House prices will continue to rise in West Auckland in 2016.

Until next time,

Best wishes,

John Goodrum

Licensee Agent REAA 2008

021945140, 09 838 8895