Expecting anything can be a dangerous game in property. It appears that while you can plan for anything those plans will not always go the way you intend them to – particularly when it comes to dealing with tenants. As the market continues to adapt and evolve, both as a response to change and a catalyst for yet more new changes, tenants are crying out for more rights, better quality of living and of course more manageable rents. Landlords, on the other hand, are expecting fewer changes on the horizon, tenants who are easy to manage and higher rents. So where is the middle ground? Is there ever going to be a time when landlords and tenants don’t feel as though they are on opposing sides in a battle over housing? And what will this continued strain do to the already volatile marketplace?
The quality of living for a tenant has already drastically increased since Tommy’s Property Management opened its doors. Legislative changes coupled with more demand for high quality property has seen a lift in the standard of living for many. However, there are still plenty of tenants living in cold, dark and damp rental properties and, paying a premium to do so. More and more tenants are entering viewings asking questions about whether or not the property is double-glazed and how many heating sources it has, as opposed to the previous questions, “is there heating at all?” and whether or not the property is ready for the Healthy Homes Guarantee Bill, which is set to be introduced in 2021. Tenants, now more than ever, are aware of their legal right to a healthy, dry, warm and safe home.
Properties which are renovated but draughty can easily go for less money now than one which is double-glazed and insulated but dated on the interior. With more and more tenants looking for higher quality property, the demand stays high as properties deemed not to be of a suitable standard take much longer to rent.
Landlords of course on the other hand, of course, are expecting rents to continue to climb as they try to recover the costs incurred by increasingly expensive legislative changes. Having been legally obligated to improve the quality of their property, landlords assume that tenants will be queuing up at the door for their new and improved product. Unfortunately, in a market where a large majority of the stock is at a similar standard, being insulated no longer lets you stand out above the competition; on the contrary, only being insulated actually puts your property behind the eight-ball. However, with higher quality property landlords should be able to expect longer periods of tenure – with tenants settling down as the need to move to more suitable and warmer homes should theoretically, no longer exist.
Landlords with these properties are already standing out from the crowd and will attract more high-quality tenants that will likely stay in the property for the foreseeable future, seeing no reason to sacrifice a warm, dry and safe home for an inferior property. The number of landlords whose rental property are not up to scratch could see a significant cost incurred to them as they not only try to comply with upcoming legislation, but also then compete with other landlords who have already done the work. Just meeting the minimums will no longer be enough for landlords who want to tenant their property quickly for a great price.
Rents could continue to climb as property owners seek to recoup their expenses on these upgrades and tenants are prepared to offer higher and more competitive amounts to secure the outstanding properties in the market. However, with such a trend going ahead, it could be conceivable that many landlords seek to capitalise on their increased property values and step out of the industry, in a bid to seek out more manageable investments.
This could lead to a larger number of properties being owned by a smaller number of individuals and consequently, a more commercial approach to property investment.
To find out more about what Tommy’s Property Management can offer to maximise your property’s value and be ‘Healthy Home’ compliant – head to
https://tommysrentals.co.nz/blog/ and check out our last blog article ‘Maximise and Comply’ and how our new partnership with Mitre 10 Crofton Downs could benefit you.
If you would like to know how you can prepare your property for the market, futureproof your investments, or even know what your rental properties might be worth both on the rental and sales market, feel free to give us an obligation free call anytime on 04 381 8604.