Kia ora Owners,
I’m Jacob Holmes, a Property Manager here at Tommy’s Property Management. It’s a pleasure to be working alongside our experienced team to ensure your property investments are managed to the highest standard. In this Bi-Monthly newsletter, we’ll be sharing key market insights, success stories from our landlords, and strategic advice to help you continue growing your portfolio in Wellington’s dynamic property market.
Whether you’re looking to maximise rental income or expand your investment, our goal is to keep you informed and confident in your investments.
Let’s dive into this month’s updates!
Market Insight
In a competitive market like Wellington, it’s natural for some landlords to feel a bit uncertain or even anxious about the future of their investment. But there’s no need for worry. Wellington has a vibrant and promising future, and this newsletter is here to give you the confidence that your investment is on solid ground. Let’s explore why Wellington remains a smart and exciting place to invest.
Here’s a quick comment from our Business Development Manager, Hilary Sampson:
“This side of Christmas is always a busy time of year for those planning their next steps and considering the new year, moving homes for work, financial reasons, or to be within a particular school zone. We are starting to see an improvement in numbers attending viewings, and well-priced stock is getting picked up in shorter timeframes. Along with a steady number of appraisals, we’re offering solutions for students, young professionals, families, and those looking for short-term furnished options for their next move. The mood is positive, and I expect it to continue right up to Christmas this year.”
If you’re thinking about growing your property portfolio and would like some expert advice, feel free to reach out to Hilary via email at Hilary@tommysrentals.co.nz or give her a call at 027 235 4478. She’ll be happy to assist!
Wellington Market Growth
Declining Capital Growth (Sep 2021 – Sep 2022): Starting in late 2021, Wellington experienced a sharp decline in property values, with capital growth dropping from around 40% to -30% by mid-2022. This drop was likely due to rising interest rates, inflationary pressures, and regulatory shifts that cooled the market.
Stabilisation and Recovery (Late 2022 – September 2024): Following this significant drop, we saw a gradual recovery towards the end of 2022. As time goes on, property growth is bouncing back to numbers we’ve seen previously, and the longer you hold onto your property, the higher the return you’re likely to see.
Below is a link to Tommy’s latest market update, highlighting the spring surge and rising prices that signal renewed buyer confidence in Wellington’s housing market.
Wellington’s Housing Market Heats Up | Market Update | October (tommys.co.nz)
Wellington’s population is set to grow by 50,000 to 80,000 over the next 30 years, and the inner-city population is expected to double in the next decade (Wellington City Council, 2022). This kind of growth will naturally have a big impact on the rental market. More people looking for homes, especially in central Wellington, will likely push up demand and rental prices. For property owners and investors, this brings potential opportunities to maximise rental returns. However, it’s also important to consider the challenges renters may face with increased competition for properties. Creating a balance in the housing supply will be crucial to support both the growing community and the rental market. At Tommy’s, we’re keeping a close eye on these trends to ensure we’re well-positioned to help you navigate the changes ahead.
What This Means for Investors:
Despite recent fluctuations, the long-term outlook for Wellington remains strong, especially with the city’s projected population growth and continued demand. At Tommy’s, we’re confident that the rental market will continue to thrive, providing stability for property owners. With positive feedback from our Business Development Manager, Hilary Sampson. We can assure you that the year will finish on a high note, with strong performance for your property assets. As Wellington grows and evolves, there are plenty of opportunities ahead for both investors and renters, ensuring a robust future for the local property market.
Maximising ROI Through Smart Renovations
At Tommy’s, we pride ourselves on not only keeping your asset in top condition but also striving to elevate it to the next level.
Please CLICK HERE to read about a transformation story from one of our many treasured clients. If you’d like to explore similar opportunities with your property, contact the Tommy’s team. We specialise in transformations that improve your rentals by speeding up renovation time and being more cost-efficient!
Development News:
Four Kapiti
Let’s turn our attention to an exciting new development in the Kapiti area: “Four Kapiti.” GibbonsCo, known for their high-quality multi-dwelling developments in Wellington and Auckland. They have partnered with the esteemed architects Novak & Middleton to bring something truly special to the Kapiti Coast. This development of 2, 3, and dual-key townhouses promises to raise the bar, offering modern, stylish homes in a region that’s becoming increasingly desirable.
Kapiti offers a relaxed, laid-back lifestyle, stunning beaches, and its own unique microclimate that makes it feel like a little world of its own. With the nearby train station, excellent public transport links, and Transmission Gully, Kapiti is more connected than ever. The commute to Wellington will take just 30 minutes—allowing those who work in the city to easily retreat to the warmth and charm of Kapiti after a busy day.
With so much to offer, it’s no surprise that Kapiti is growing fast. The population is expected to rise by 30,000, reaching over 85,000 by 2050, and an additional 12,000 homes will be needed to meet demand (source: BERL Economics). Major infrastructure projects like Transmission Gully make Kapiti even more appealing as a place to live, blending the best of both worlds: a peaceful coastal lifestyle with easy access to the capital.
Now here’s some small comments from our Area Specialist out in Kapiti who is deeply involved with this new development, Julia Day
How many owners are buying to rent compared to living? a large portion of the properties at 4 Kapiti are investment properties – the first stage of the complex has settled and there are already around 30 properties on trade me for rent
Are tenants showing much interest? There are so many available at the moment so whilst there is interest it really is going to come down to pricing structure to determine who rents theirs first
How much are they renting and selling for? We started off advertising our 2 bedrooms for around the $670 mark. There is price cutting going on at the moment and some are being advertised for $610 to beat the competition, others are advertising 2 weeks rent free
Comment From Julia Day – Area Specialist
“Right now, competition in the market is pretty strong, especially with the influx of TradeMe listings after stage 1 of the Four Kapiti development settled. It’s understandable that some property owners are feeling the pressure and offering extra incentives to attract tenants. But as things settle and listings return to more typical levels, I’m confident we’ll see prices adjust back up. For those considering the Kapiti market, this could be a great moment to jump in. With interest rates easing and exciting new infrastructure like Transmission Gully making access easier, it’s an opportunity that might not last for long.”
If you would like to inquire further about opportunities in the Kapiti region, give Julia an email at Julia@tommysrentals.co.nz or a call at 027 558 8017
Financial Tips
While Tommy’s can’t provide financial advice, we can certainly point you to the experts. Below is a link to an article that offers valuable insights into managing your mortgage:
Fix or float: what’s the best home loan option for you? – Moneybox
In this article, MoneyBox breaks down the pros and cons of fixed vs floating rate mortgages, helping homeowners make informed decisions about their mortgage options. A fixed-rate mortgage offers stability with predictable payments, while a floating-rate mortgage provides flexibility, allowing you to take advantage of lower interest rates but with the risk of potential increases. MoneyBox also discusses when it might be best to fix, float, or use a combination of both, depending on market conditions and your financial situation. They highlight strategies such as splitting loans and revolving credit for those looking for a balance between stability and flexibility. For those seeking to secure the best mortgage rates, the article offers valuable insights to navigate these decisions effectively.
Be sure to check out the full article for more in-depth advice and practical tips!
Thank you for your continued trust in Tommy’s Property Management. We’re committed to providing you with the latest insights and best practices to ensure your property investment remains strong and profitable.
For any questions or to discuss your portfolio further, feel free to reach out to our team.
Ngā mihi,
Jacob Holmes
Property Manager