Lockdown 2.0 here we go...at least we know what we're doing this time!
As we find ourselves in COVID Alert Level 4 again, at least we are a bit more relaxed in that we know what we are in for and have the technology to ensure things carry on as normally as possible. Alert Level 3 & 4 are, by design, very restrictive and have the most impact on personal interaction.
What does Alert Level 3 mean for landlords and tenants?
Tenants who live in an Alert Level 3 area can move house to an area at the same Alert Level. If tenants are moving within an area that is at Alert Level 3, removal companies can assist with moving.
In-person inspections of rental properties cannot take place. We have an app that allows virtual inspections or Tenant Assisted Inspections (TAI’s) and our team have been working with those tenants that have been due for inspections over the lockdown period to complete these.
At the end of the tenancy, the landlord and tenant are unable do the final property inspection together, as would be usual practice. The property managers are only able to complete these once the property is vacant. We can then confer with the tenants via FaceTime or over the phone whilst at the property.
At Alert Level 3 & 4 we are able to have trades attend to any urgent maintenance issues that may arise, naturally all discretionary works are on hold.
Viewings under Level 3 are by appointment only rather than multiple groups to an open home, with physical distancing and public health measures followed. If the property being viewed is tenanted, we need approval from the tenants and viewings can only occur when the tenants are not at the property.
Enough of COVID and onto the market. Last year post lockdown the market was very, very active, we can only but wait and be ready for what will happen this time around when we get to Level 2 - my guess is the same!
Last week, I made some commentary on LinkedIn following an article quoting Trade Me data that rents are up by the largest amount on record. Interestingly, Canterbury had the largest annual uplift in rental demand - up by a sizeable 26%.
As we know, supply and demand is a driver of rents but coupled with the effect of central Government’s new tax policies aimed at landlords - rents are skyrocketing.
The huge increase in cost of providing rentals is, rightly so, being passed on to the end user as it would in any business. We have been steadily increasing rents as leases come up for renewal. The market is very similar to post quake - significantly increased rents which tenants are accepting as there are few alternatives available.
A small number of landlords have exited the market due to increased costs but most long term investors will weather out the storms and those that hold in there, especially in Christchurch, will benefit. Most that have or are selling were going to anyway and have just bought it forward to take advantage of the huge increase in property prices. The full article can be found here.
We truly appreciate your business and the team and I are always just a phone call away. We are always available for a free chat and are happy to share our experience and knowledge wherever we can be helpful.
An active investor for over 25 years & qualified builder, property has always been a part of life. Hamish has sat on the committee of the Canterbury Property Investors Association including two years as President.