With talk now beginning of how New Zealand will bounce back from the coronavirus crisis, it’s reassuring for landlords to know that new research shows most tenants have not missed a rent payment.
This great news for property investors illustrates the underlying strength of the rental market and the stability of the property sector compared with the stock market.
Landlords have been confronted with the government easing rules to help renters cope with the economic impact of the virus.
This assistance has included freezing rents for six months, a suspension of rent rises from before the virus crisis, a moratorium on evictions for three months and the Tenancy Tribunal being encouraged to find in favour of any tenant who shows in good faith financial distress suffered because of the economic impact of the coronavirus.
But the new research shows that despite the strictness of these conditions, the majority of the rental market has come through unscathed.
The NZ Property Investors Federation (NZPIF) has found 81% tenancies have not been affected by the crisis. Only 6% of renters had left their property and 2% had stopped paying rent. Only 5% of landlords have reduced rents and 1.5% have permitted payment deferrals.
Now restrictions have been eased to Level 2 with open house inspections permitted, we’ll see increased investor activity as cash flows from the share market and into the property sector.
As your real estate agent, we think that this is a great time to discuss your options if you’re thinking of starting or growing your property portfolio. The cash rate is just 1%, and there are excellent buying opportunities now and in the aftermath of the coronavirus crisis.
Now more than ever, it is important to take a long-term view of your property portfolio. The current market is playing in the buyer’s favour, but that might not last for long.
