We’ve made the cut…
Check us out.
Changes are coming…
Interest tax deductibility. We mentioned in the last news snippet, the interest tax deductibility rules for residential property have changed and interest limitations are being phased back out.
From the 1st April 2024 – 31st March 2025 you can claim 80% of your interest as an expense and from the 1st April 2025 onwards it will be back to 100%.
Bright-line. The bright-line property rule has also changed. From 1st July 2024 the bright-line property rule will only apply if the property is sold within 2 years of purchasing. (Pre July 1st 2024 the current bright-line periods continue to apply).
As always, please check your own personal circumstances with a Financial Advisor, as these rules are complex and have exemptions and quirks. You must ensure that you receive advice tailored to your financial position before making any decisions.
Residential Tenancies Act updates
The Amendment Bill is being developed by the Ministry of Housing for introduction to Parliament in May 2024. IF the Bill passes, it could become an Act in late 2024.
The bill includes the following;
(1) Reintroducing 90-day ‘no cause’ terminations for periodic tenancies, meaning owners can end a periodic tenancy without requiring a specific reason.
(2) Reintroducing owners’ ability to give notice to end a fixed-term tenancy at the end of the term without requiring a specific reason.
(3) Notice periods for when an owner wishes to either move back into their property or have an unconditional agreement for sale requiring vacant possession will revert back to 42 days. This is a changes from the current 63 days and 90 days respectively.
(4) Returning tenants’ notice period for ending a periodic tenancy to 21 days.
(5) Making it easier for owners to accept tenants with pets by introducing pet bonds which will be 2 week’s on top of the current 4 week’s bond collected. Owners will still need to consent to tenants having a pet, however consent can only be withheld on ‘reasonable grounds”. You can read the Beehive’s announcement Pets.
For further information on RTA Amendments read more HUD updates.
Well done Seren – Property Manager of the Year 2023
We recently attended the PMC (Property Management Conference) in Wellington. It was great learning for us and gave some fantastic insights as to how we can better serve our customers.
We were tickled pink when our own Seren Ball picked up the award for Property Manager of the year! Go Seren – we are very proud of you.
We won!
We mapped out all 27 of our regular business processes and one by one we are looking at how we can improve each one. Which technologies are available, when efficiencies can be made and where we can offer more sustainable/environmentally friendly solutions. The first one we looked at was our tenant finding process. How to give both property owners, existing tenants and prospective tenants “the greatest rental experience in NZ”. Here’s a brief look at the changes we made;
- Property Readiness – Work it, work it…
We work with the existing occupants (either owner/tenants) to ensure that the property is “ready”, decluttered and we also have a small amount of props (throws, plants, jugs, towels and fruit) to add some flair and colour.
- Adverts – Attract interest early
Our adverts give prospective tenants enough information about the property to be confident enough to apply in advance of the viewing (not mandatory of course).
- We stand-out – We use our own template frame with a logo in order to stand out from other adverts
- We only use professional photography
- We have embraced technology and have a 3D walkthrough on all listings (where permission is granted) in order to showcase the property.
- Viewing – Get close and personal
All attendees interested must book in for one of our twice weekly viewings and we keep in touch. They receives a links, texts and phone call reminder to attend and meet us! During the small viewing we CHAT. We establish who would like to proceed quickly. By using our 2 person team structure coupled with evening working it means the PM can be at the viewing and whilst their partner at the office will following-up and starting to process applications for the interested parties. All this can happen within 30 minutes of the viewing and it does!
- Instant Feedback – Faster approvals
Contact with the property owner enables faster approvals. After every viewing, from the viewing, the owner receives a video about how the viewing went and when to expect completed applications.
- Strategic Planning – As per the plan!
At the end of each week, we have a quick report that summarises the week of the campaign and identifies the pre-agreed strategy for the following week for the owner. We have a 4-week strategic plan for every listing (which aligns with a tenant’s notice period). The customised plan includes changes, tweaks and incentives to keep the campaign hot!
We’re so happy that this simple but effective idea has been recognised and as such we are proud to have been announced amongst the finalists in the 2022 Westpac Awards for Excellence in Innovation.
We Won!
It was great to see the announcement by REINZ at the awards ceremony (over Zoom). We are delighted by the news and wanted to share it with you first.
We did it! We received the best award in property management across New Zealand and this is all thanks to you!
“Congratulations The Rental Bureau – REINZ Property Management Small Office of the Year!”
We so proud to be recognised for this award by REINZ. We know that we really and truly couldn’t have done this without the support from our customers, both tenants and owners. You have shared this journey with us and we can all take pride together in this great achievement from a small local business.
Regulation confirmed, meth standards sorted and more changes to Healthy Homes…
Big News – Minister of Housing Megan Woods made three big announcements this month. Here’s a quick summary of what coming;
- Property Management will be regulated by May 2026.
As you know The Rental Bureau petitioned and made a submission in favour of this, as we want our great standards to be shared by everyone in the industry. It means that all PMs must be qualified and licensed to practice – we are very happy and very ready for this!
- Submissions for one recognised meth standard.
Again – super happy as since the Gluckman Report came out, there have been discrepancies between what is considered to be safe. The Tenancy Tribunal recognises the Gluckman’s minimum standard less than 15mu to be safe, however many insurance companies and the official guidelines are still working to 1.5mu leaving tenants, owners and PMs unsure how to proceed. This clarity is long overdue and very welcome!
- Healthy Homes – 12-month extension.
The reason behind this extension is that state housing officials have been unable to meet their own deadline, and it’s understandable this has caused some unrest to say the least. However, the reality for our clients is that only 15% have periodic tenancies that were signed prior to July 2021. The remainder have the security of renewed fixed terms, which meant healthy homes compliance was triggered. We have 1% of our clients who will benefit from the extension and remain “compliant” the rest of you are job done and can sit back and relax!
Christmas has come early – Ashley Church is coming to see us! Join us on 7th December!
Join Our Investment Night – An Evening with Ashley Church
Our last Investor Evening was so good that we are doing another one before Christmas and we’ve got an amazing treat in store.
Ashley Church is coming to Titirangi and for us this means Christmas is coming early!!!
Ashley is a well-known media commentator with views on property and politics and is frequently quoted on radio and in print. He writes a weekly column for the Herald and appears regularly as a guest commentator and industry expert in national media and television programmes. He has an extensive background in the property industry, going back more than 30 years and had established his first portfolio of 7 properties by the time he was 23.
Join us for a glass of bubbles and a great evening of networking. This one is not to be missed!
When: Wednesday 7th December at 6:30pm
Where: 1st Floor Seminar Room, Lopdell House, 418 Titirangi Road, Titirangi
(above Deco).
Places are very limited, so please book early to avoid disappointment.
We’ll see you there!
Come to our Investor Evening on 2nd November and find out how…
Join Our Investment Night
We can’t ignore that the disincentives for property investors to hold a rental property portfolio has an impact on the rental market. As always at The Rental Bureau we are looking for new and creative ways to compensate for some of the changes to the legislation. On this note, we very pleased to share that we are holding an investor evening and have a fantastic line up of speakers.
The event sponsored by The Rental Bureau, Haven Accounting and Harveys Synergy Real Estate welcomes key speakers from Opes Partners, Ilse Wolfe, Peter Norris and Dani Paim and includes a takeaway bag full of goodies AND over $1000 of on-the-night draw prizes.
Ilse Wolfe who you may have seen in the Property Investor Magazine is coming to Lopdell House in Titirangi to talk us all through some creative ways to add value and get more rent from your investment property without laying out a dollar! Ilse will demonstrate increasing rents dramatically by creatively making the most of what you have got – often without even needing resource or building consent.
When: Wednesday 2nd November at 5:30pm
Where: 1st Floor Seminar Room, Lopdell House, 418 Titirangi Road, Titirangi
(above Deco).
Places are very limited, so please book early to avoid disappointment.
We’ll see you there!
Combat rising interest rates
Here’s our top four strategies to combat the rise of interest rates and help to protect your assets:
- Stagger you lending – if you break your loans down into several smaller loans, this will help to spread your risk over time, and hopefully average out your interest rates in the long run.
No one can predict the future, however if you split your loan into several smaller loans and stagger them to shorter and longer term fixed loans you will have both the benefit of the usually lower interest rates for a shorter period and the benefit of security over a longer period. Your interest rate over the period of your loan will be the average of the longer and shorter rates over time. A very simple example is as follows: $1m loan split into five $200K smaller loans. If the rates were 1 year @ 2%, 2 years @ 3%, 3 years @4%, 4 years @5% and 5 years at 6%. For this example, we assume that over the 5 years interest rates remain consistent. This would mean that over the course of the years, your rate would average out to be 4% with the added security of having some funds locked in.
- Reduce your lending (duh!),
This probably doesn’t need much explanation. If you can put aside an extra $100 per week, this will be an extra $5k per year of the loan amount. Over a 30 year loan that’s $156k and a lot of saving on your interest.
- Diversify your portfolio with respect to the bright-line rule, interest deduction allowances, and of course your personal circumstances
You can sell off the elements of your portfolio that are not tax efficient and replace them by purchasing one that are for example if you have older properties that are heavily geared, in 2024 you will not be able to claim interest as a tax deductible allowance. If you are in this situation, you could look to sell this property and buy a new build where interest can be deducted before tax, This is one to discuss with you accountant or financial advisor, as there are a lot of rules that you must take into account when looking into this.
- Utilise revolving facilities and interest only loans.
Again one to be discussed with a financial advisor or mortgage broker. If you need to speak to one, please get in touch, as we work with excellent partners who will be able to help as this is about structuring your loan. For example if you currently have $1m loan on interest and principle because you want to pay off your loan, another way of achieving the same goal is to have (say) $900K on interest only and $100K on a revolving facility which you can pay into whenever you choose to. So you could aim to pay $20K of this off each year for 5 years. The benefit is that you can also draw on these funds when you need. Another benefit is that some banks don’t take revolving facilities into account when calculating servicing.
Disclaimer: The information above is not financial advise and should not be taken as such. For professional financial advice, you must speak to a qualified financial advisor. Please contact us if you would like us to put you in contact with one of our specialist partners.
We are finalists!
We mapped out all 27 of our regular business processes and one by one we are looking at how we can improve each one. Which technologies are available, when efficiencies can be made and where we can offer more sustainable/environmentally friendly solutions. The first one we looked at was our tenant finding process. How to give both property owners, existing tenants and prospective tenants “the greatest rental experience in NZ”. Here’s a brief look at the changes we made;
- Property Readiness – Work it, work it…
We work with the existing occupants (either owner/tenants) to ensure that the property is “ready”, decluttered and we also have a small amount of props (throws, plants, jugs, towels and fruit) to add some flair and colour.
- Adverts – Attract interest early
Our adverts give prospective tenants enough information about the property to be confident enough to apply in advance of the viewing (not mandatory of course).
- We stand-out – We use our own template frame with a logo in order to stand out from other adverts
- We only use professional photography
- We have embraced technology and have a 3D walkthrough on all listings (where permission is granted) in order to showcase the property.
- Viewing – Get close and personal
All attendees interested must book in for one of our twice weekly viewings and we keep in touch. They receives a links, texts and phone call reminder to attend and meet us! During the small viewing we CHAT. We establish who would like to proceed quickly. By using our 2 person team structure coupled with evening working it means the PM can be at the viewing and whilst their partner at the office will following-up and starting to process applications for the interested parties. All this can happen within 30 minutes of the viewing and it does!
- Instant Feedback – Faster approvals
Contact with the property owner enables faster approvals. After every viewing, from the viewing, the owner receives a video about how the viewing went and when to expect completed applications.
- Strategic Planning – As per the plan!
At the end of each week, we have a quick report that summarises the week of the campaign and identifies the pre-agreed strategy for the following week for the owner. We have a 4-week strategic plan for every listing (which aligns with a tenant’s notice period). The customised plan includes changes, tweaks and incentives to keep the campaign hot!
We’re so happy that this simple but effective idea has been recognised and as such we are proud to have been announced amongst the finalists in the 2022 Westpac Awards for Excellence in Innovation.
Marketing your property
It is now more important than ever to make sure your property is as appealing as it can be to attract great tenants, who are willing and able to maintain the rent and take the best care of your property. Properties need to be presented flawlessly in viewings, and we know from experience that this can often mean investment is needed to tidy up between tenancies. Clean, uncluttered, cared-for properties will rent more quickly, so talk to us about ensuring that your property is rent-ready in order to maximise your investment. Here are our top 5 recommendations for property readiness between tenancies.
- Professional photos taken
- Video walkthrough of the property
- Clean and decluttered
- Gardens and lawns have been maintained prior to photos and viewings
- Any wear and tear fixed where possible and all maintenance completed
From our experience when a property owner works alongside us and enables us to action all of the above the turnaround time between tenancies is minimal and attracts a high calibre of tenant.
***Watch this space for how we’re bringing exciting changes to your marketing.***
What a standard day looks like for a property manager
Do you ever get to the end of the day and wonder where all the hours have gone? We do too, so we thought we’d look into it a bit. Here’s a little glimpse into the work we do day-to-day to manage our properties.
- Negotiating lease renewal between owners and tenants – this can mean several email exchanges, and often upward of two hours in total time spent just on one property – and we manage more than 200! That’s a lot of emails and hours.
- Chasing rent arrears and negotiating payment plans for tenants who may have fallen on harder times can easily take more than one hour, for one property. We do pride ourselves on having low rates of rent arrears though.
- Completing thorough online rental appraisals for prospective owners can take us around an hour, and that’s with all our experience and access to the right tools.
- Letting a property takes on average four to five viewings, and of course there is travel time involved, not to mention all the behind the scenes work with advertising, organising photography, and managing submissions.
- Completing a thorough property inspection report, including travel to and from the property takes on average between two and three hours.
- A move-in/move out negotiation can take us a whopping six hours on average!
- Diagnosing and arranging maintenance requests from acquiring quotes, to receiving owner approval, through to assigning the work and invoicing can take at least an hour and a half for even the smallest job.
If you add in tribunals and mediations, owners selling, fielding general enquiries, counselling, and the mammoth task that Healthy Homes compliance added to the mix, there’s no wonder our days here go so fast.
Why are we pointing all of this out? Sometimes, it can be easy to underestimate the work involved in managing a rental property, as many first-time property investors find out very quickly. If you know anyone struggling to manage this while holding down a full-time job give us a call and let our award-winning team ease the load!
The property management sector is being regulated – Hurrah!
How will this change what we do for you? It won’t actually change much at all, we were already self-regulating many of the things that are very likely to be be put in place industry-wide. Here’s are some insights as to what property management may look like post regulation…
- Gain a license to practice – Hurrah!
- Be trained and qualified (all our PM team are fully trained to NZQA level)
- Follow a professional code of conduct (we’re already registered with REINZ)
- Have insurance (we have always operated with insurance)
- Have a separate client trust account (yes, of course, we already have this)
- Have accounts independently audited (we already do this annually)
There will also be a formal, independent complaints process in place – Hurrah!
So in a nutshell, we whole-heartedly welcome the changes for the industry and really hope it means we will start to see fewer of those unscrupulous PMs on the scene. For TRB however, we’ll just continue doing what we have always done to give you the best rental experience. Rest assured – you are in good hands.
Healthy Homes changes and updates
Here is a brief summary of the proposed changes;
For properties that already meet the 2008 Building Regulations such as new build properties or properties that have been renovated to meet this regulation specifically for glazing and insulation,
- Heating standard deadline extended. The 90-day compliance requirement will not start until 6 months after this change comes into effect. If the change was in effect now and a new tenancy agreement signed, the compliance date would be 6 months plus 90 days.
- Top-up heating requirement. Currently, if your heat source installed before July 2019 falls short of the requirement of 1.5Kw or less, you can top-up with an electric heater. This has changed to allow up to a 2.4Kw top-up shortfall.
- Tolerance for existing heating. Currently, if your heat source was installed before July 2019 and is within 90% of the requirement then you comply until the heating needs to be replaced. This has changed to 80%.
- Ventilation. Currently, kitchen and bathroom extractor fans that passed the building consent process after 1st November 2019 may not be compliant with Healthy Homes Regulations regarding capacity and ducting diameters. This change allows compliance for Healthy Homes where the consent process has signed this off. In summary, the processes are now aligned.
For more information, please see the following link;
We’re already almost 90% fully compliant for Healthy Homes
We’re leading the way in Healthy Homes Compliance. We have 90% of our clients either fully compliant or awaiting jobs to be completed to be compliant. We are committed to achieve 92% compliance by March 31st
This means our tenant clients are feeling the full benefit of this legislation early. It also means our owners are not at risk of non-compliance. It means that our properties are of a higher standard and more desirable when in becomes time to re-tenant them. We think all of this hard work is paying off and it’s another WIN-WIN-WIN for us!
Let’s extend the Healthy Homes compliance date please, Jacinda!
Any new tenancies or renewed tenancies that commenced after 1st July 2021 have 90 days to become fully compliant for Healthy Homes. For properties that are brand new to the rental market, owners had to obtain a healthy homes assessment, obtain the quotes required to become compliant and then book the contractors in to do the work. In a 3 month timeline, this is already a challenge for some, however throwing a 5 week L4 lockdown into the mix made it almost an impossible tasks for property owners.
We hope that the Government listens to the wise words from Joanne Rae – Head of Property Management at REINZ and applies the same logic to our industry as to the car industry by extending Healthy Homes compliance just as they extended the WOF compliance.
Bright line and interest deductions
(1) Bright-line test timeframe to double from five years to ten years. In a nutshell, the current bright-line rules currently provide that a sale of residential property is taxable if sold within five years of acquisition and the property is not your main home. (Other exemptions can apply). The bright-line test will move to 10 years for residential property acquired on or after 27 March 2021. Property acquired before 27 March 2021 (and after 29 March 2018) remains subject to the five-year bright-line test. “New builds”, will continue to be subject to the five-year bright-line test.
(2) No deductions for interest on residential property held for newly purchased investment properties. For residential property acquired on or after 27 March 2021, from 1 October 2021 no deduction will be available for interest on loans used to acquire them. The premise is that tax should not provide a shelter to reduce the cost of ownership for investors.
(3) Progressive 25% reduction each year on deductions for interest on residential investment purchased pre-March 27th 2021 (starting Oct 21) For residential property acquired before 27 March 2021 interest on loans remains deductible initially, however on a reducing basis over the next four years. This will be a progressive 25% reduction each year, with a final outcome of no deductions (for any residential property acquired at any time) for interest from the 2025/26 and later income years.“New builds” are excluded from the above ruling. With respect to deductibility (or non-deductibility of interest), this appears to have been modelled on a similar change presented in the UK.
(4) New build exemption The exemption applies to ‘new builds’. This is defined as properties that received the final code of compliance (CCC) on or after March 27, 2020, and the exemption applies to both the initial purchaser of the new build and any subsequent owner within the 20-year period. The ‘new build’ definition includes prefabricated houses and the conversion of existing dwellings into multiples where a final CCC has been obtained post march 27, 2020.
Healthy Homes – the facts
Healthy Homes
From 1st July 2021 every new tenancy, tenancy renewal or amendment needs to include a Healthy Homes statement. We have created a simplified version of the statement and a comprehensive E-Guide explaining what is required.
The statement either needs to demonstrate compliance OR if the home is not yet compliant you have 90 days in which to complete the work necessary to become Healthy Homes compliant.
If there are no changes to your tenancy, then you will have until 1st July 2024 to become compliant.
Over 90% of The Rental Bureau homes are compliant for Healthy Homes.
For more information on Healthy Homes compliance, or to get a copy of our free Healthy Homes E-Guide, please contact us.
