July 27, 2024 • 41 mins
Trade Me's latest data shows rent prices are falling for the first time since 2022.
Helen O'Sullivan joins Tim Beveridge on The Weekend Collective to discuss this and more.
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Speaker 1 (00:05):
You're listening to the Weekend Collective podcast from News Talks
Ed Bassure.
Speaker 2 (00:39):
Yesterday was bad.
Speaker 3 (00:44):
And welcome back to the Weekend Collective. It is time
now for the One roofe radio show. We want your calls.
We'd love to have your participation on one highty ten
eighty in text on nine two nine two, And today
my guest is from Velocity with an A at the
start and her name is Hello Sullivant, Hello Helen, how
are you going?
Speaker 2 (01:01):
Good tim? I am great to thank you? How are you?
Speaker 3 (01:05):
Very good things and just explain a little bit for
those people who will have heard of Velocity about what
you guys do.
Speaker 2 (01:12):
Yeah, Velocity is a quibi o proptic that provides a
lot of valuation ordering and management software for banks. And
we also have a new product called Velocity Nexus which
we provide to the real estate industry, which is a
property research tool that real estate agents use to assess
and research their markets.
Speaker 3 (01:35):
And so for the average punter, what would they use
for them?
Speaker 2 (01:38):
For the average we don't have a consumer offering, but
what we are providing is parwering real estate agents. And indeed,
the one roof website is kind of kind of what.
Speaker 3 (01:47):
Brings me here, Tim, That is fantastic because we love
the one Roof website actually on the velocity on the
value side of things. So the first thing we want
to have a chat about is that, were you surprised
that trade Me data shows that rent prices are for
the first time in a couple.
Speaker 2 (02:06):
Of years, not surprised to see that that market is
definitely softening. Yeah, all my sources are telling me that
the rental market is definitely a lot softer than it
has been. Demand as low. I mean, that's normal for
this time of year anyway for some peculiar reason, and
Auckland people don't like shifting their stuff in pouring rain.
(02:28):
Go figure. Yeah, it's definitely softer than usual.
Speaker 3 (02:31):
It did surprise me because I think until recently the
immigration figures had shown this massive number of people who
are leaving and of course we're sort of importing people
to make up for that, but in fact, sorry, a
massive number of people still arriving as well. We had
in the past year some amazing immigration stats. But it
does surprise me that that hasn't well, it hasn't equated
(02:55):
to one a rise in property prices or rents, but
in terms of the rental price drop. How much of
that has to do with government policy because well, for instance,
the lack of deductibility was obviously to me a factor
in putting rents up, because you make it more expensive
to be a landlord, you're going to pass that on.
(03:15):
But is that a factor at all or not yet?
Speaker 2 (03:19):
I don't really think so, because the thing with rent
is that it's not really set by the costs that
the landlord is experiencing. It is mainly driven by the
market and what is achievable for that property. Most rental
properties do actually run out a cash loss.
Speaker 3 (03:38):
Okay, well, how about this then? Is the market driven
by the fact that overall for all landlords it was
more expensive too, you know, you couldn't deduct as much.
So is the market influenced by policies like that? And
we don't worry people, We're not going to make this
a discussion abound whether deductibility and text ductibility and all
that sort of thing is a good thing or not.
But I mean, if you take a macro view.
Speaker 2 (04:03):
Look, my macro view is my my experience of the market,
is that what landlords is, what is achievable in revenue
and rent is very much driven by the supply and
demand as opposed to input prices, which is where the
deductibility or otherwise comes in.
Speaker 3 (04:23):
Okay, So when they're talking about a drop in rental prices,
I guess that is we're not seeing people haggling their
rents down yet, are we? Would that be just as
new listings come up. We've just noticed that the average
price of new listings for rental is slightly cheaper.
Speaker 2 (04:42):
Now, I think it's more. Number one, we're not saying
rents continue to go up as they had been doing.
And number two, you if you spent a lot of
time monitoring rental sites, as geeks like me do, you
will see properties that have been on the market for
some time starting to drop in price. And then when
(05:06):
a new when new stock comes to market, they landlord
will probably managing when they're setting the rent We'll look
at what's being advertised around the area and in that space,
and they'll set their price accordingly. Yeah, because there's no
point in you know, it's surprising how price sensitive the
rental market is. If you overprice a rental property by
(05:28):
twenty or even twenty dollars, you will find that you
don't get inquiry for it.
Speaker 3 (05:34):
Actually, by the way, we should give these stat actually,
just because when you hear that rentals have dropped, it
makes you think, oh wow, how much. But it's a
month on month looks like it's a five dollars a
week drop to six hundred and forty five bucks, So
it's it's hardly plummeted or anything. But I guess it's
just a relief to people who are renting or looking
(05:57):
to rent that it's not this crazy market where you know,
you've got to go bid against it with other people
and or guess what, you know, another fifty bucks will
do it more.
Speaker 2 (06:07):
Than anything else. It's preferable to find yourself at an
open home with a horde of people, which I remember
doing in my bad old days renting, and you'd turn
up and there'd be fifty people standing outside the open home.
Speaker 3 (06:20):
You go, oh my god, Actually, actually I do. I
only remember that because when we rented, we bought the
place that we were renting. But when we rented it
and we had a couple hundred meters from Saint Helia's Beach,
and there was no one interested in looking at it
because it was an old it was old like the
day course you know, sort of that sort of eighties
pink sort of car.
Speaker 2 (06:43):
Yes, oh gosh, avocado.
Speaker 3 (06:46):
It was all pretty pastal and it was pretty dated
and all that. But the agent it was well priced,
but it was well priced, but no one was looking. Literally,
I didn't have to burd against anyone. No one was
looking at it. And I think I made an offer
for a bit cheaper than it was and the agent said, yeah, sure,
And I mean it was the best news ever. But
(07:07):
of course then you go forward ten years or something
and it's just it went nuts. What sees do we
ever have a sort of balanced market where maybe you've
got three or four in parties, it's not sure. What
is the happy medium? Do you think? Well, actually, the
happy medium depends on whether your renter, because the happy
medium for a renter is you're the only one interested
(07:29):
and it's nice and cheap. The happy medium for you
as a landlord is you've got people you know, fighting
to get the property, and more.
Speaker 2 (07:38):
Than anything else, you're keeping your you're keeping it occupied.
I mean, one of the things that we the counsel
that I always used to give landlords who you're wanting
to hang on for a higher price, it takes a
lot of weeks at twenty or thirty dollars a week
extra rent to pay for three or four weeks of
vacant occupation, and so you are far better to meet
(08:00):
the market in terms of the rental price and get
the property occupied.
Speaker 3 (08:04):
Actually that's not because that's quite a useful thing for
rents to bear in mind and remark like this. Then
that because if a property's been sitting vacant for a
couple of weeks and you're offering, say twenty bucks less,
it's worth make an offer. I mean it's worth that
because it's like trying to.
Speaker 2 (08:19):
Buy a house. You don't necessarily pay the asking. You'll
make an offer, so you know, you might get knocked back.
But how much does know who?
Speaker 3 (08:29):
Well, look at it this way, if it's.
Speaker 2 (08:30):
Doesn't cost you anything to get to know.
Speaker 3 (08:32):
For instance, if it's six hundred and fifty bucks and
you're thinking, you know what I'm going to ask, offer
them six one hundred and I don't know, ten or twenty.
I mean that's quite a few weeks that they would
have to make up for it. I mean, if they
had another couple of weeks vacant, that's probably worth the
landlord thinking, oh, you know what, you're a good tenant.
Speaker 2 (08:51):
You look reliable, Bengo, it's yours absolutely, and the same
when you've got tenants who are in situ and you're
looking at written rises. As a landlord, way better to
retain a good tenant than try and squeak an extra
at ten to fifteen dollars out of it and loser
a good sitting tenant. Have a few weeks back.
Speaker 3 (09:08):
We'd love to have your cause on this on how
you go about negotiating your rent when you're looking for
a property. But would you ever here's here's the big one,
and I don't to be honest, I'm not sure we're
really in this territory yet unless you are overpaying, unless
you're one of those tenants who I don't know, for
some reason, you look at your rent and you're going, wow,
we're paying way too much. Have you ever negotiated a
(09:29):
rental decrease? Have you ever back in your rental days?
If you've always Once you're in there, you're sort of like, oh,
well this is my budget, just keep paying.
Speaker 4 (09:38):
Yeah, well, I look.
Speaker 2 (09:39):
We've seen it happen, particularly when a property's value is compromised.
You know there's road works going on outside, or all
the buildings is under renovation, or you know, something's something
major happens. You know, we saw quite a bit of
it during post pandemic, when you know, particular in the
inner city there's a lot of vacancy. People who reached
(10:01):
the end of the e fixed to take a look
at trade me and go, karke place underneath me is
one hundred bucks cheaper than what I'm paying, and that's
a valid mart You know, ultimately, when it comes to rent,
you can appeal to the tendency tribunal and then and
say this is not market rent that I'm being changed,
and then you know, then it all comes down to
(10:21):
the evidence. What are some of the properties so renting
for around you? And it's pretty easy to find that
stuff on all the websites because.
Speaker 3 (10:29):
These days, actually I was thinking in the older days,
where more landlords manage their own rentals, that would be
a more awkward conversation, isn't But these days most I mean,
what do we know what proportion of properties are managed
by property managers?
Speaker 2 (10:43):
That data always used to say it was thirty to
forty percent. We're managed by property managers, And you know,
sort of sixty to seventy percent where self managed. Really,
I suspect things have changed, but it's really hard to
get a sense of what the you know, there's no
market share data that you can kind of reliably get.
But kiwis are very we're good deal. Oh wire is
(11:05):
right and in property management as much as anything else.
Speaker 3 (11:10):
That actually surprises me. But I guess because every I
think just about every expert that we've had or commentator
we've had in the studio when it comes to property investment,
the question around who should manage your property has almost
resounding I would say ninety five percent of the opinion
is that if you don't, if you just get someone
(11:32):
else to do it and avoid yourself a whole world
of headaches unless you are really really seasoned, have the
time to do it and the expertise, and you just
grate at it.
Speaker 2 (11:41):
Look, I'd totally agree, it's an incredibly complicated business these days.
You know, there's a lot of compliance and ultimately you're
in business, so there's a number of things that you
have to comply with, and my personal preference has always
been to pay someone else to work that stuff out
for me and take those you know, so that when
the sync overflowers or the toilet blocks on a Saturday
(12:04):
after no, I don't get the phone call.
Speaker 5 (12:07):
Yeah, actually, on that thing about if you are if
you do think you're in an apartment or a house
where you are paying too much, look the first price.
Speaker 3 (12:17):
The first step would be surely to talk to you
wouldn't go to the tendency to no, you wouldn't start.
I mean that's pretty I don't know a blunt instrument,
isn't it. So you talk to the landlord of the
letting agent and just say.
Speaker 2 (12:32):
First I gather the evidence, so you know, as opposed
to just going might reckon? Is I reckon I'm paying
too much? What are some of the properties in a
similar condition renting for around where you're living? Sometimes it's
really hard to find comparables. You know, you might have
the penthouse apartment, you might have the sort of the
(12:55):
dark thing on the corner on the corner of the block.
But there will be something. There will be There's always
data on on websites. One roof it has a great
mental set as well. Take a look at it and
see what some of the properties are renting for. Start
with data. As always, always my default position.
Speaker 3 (13:13):
Yeah, because I thinking if you're renting a house, the
comparisons are probably a bit more tricky, isn't it, Because
you could be a house on the same street. You
could be a three bedroom house on the same street
along with another three bedroom house, but you know, one
house might be I don't know, brand new bathroom, freshly decorated,
all that sort of thing. It's not so straightforward, is it.
Speaker 2 (13:33):
It's not straightforward, and that's why data and judgment comes
into it.
Speaker 3 (13:40):
And Okay, so you've had a chat with the landlord
and the letting agent and they've said, no, no, we're
not prepared for just the rent you signed up to it.
That was the market, and that is the market. If
you decide you want to take that further, then what
it is the tend to.
Speaker 6 (13:57):
Be in is it?
Speaker 7 (13:58):
Yeah?
Speaker 3 (13:59):
And so what's involved with that?
Speaker 2 (14:00):
Then filling in lots of forms, waiting your turn for
a hearing, attending the hearing, presenting your evidence. The landlord
or the leading agent would debtend the hearing as well,
present their counter evidence, and adjudicator listens carefully, blimey, and
(14:20):
then make the decision do.
Speaker 3 (14:21):
You have to actually turn up to the tenth stritripunal
in the flesh or is it done sort of, there's
a lot more of it.
Speaker 2 (14:27):
It's done remotely. They discovered that little handy technique during
during the pandemic, and then we went, why don't we
do this all the time. It's kind of a lot
easier and it's a lot less confronting.
Speaker 3 (14:40):
Actually, yeah, I imagine that would be, because that's half
the thing. You take the heat out of it. When
you've got an adjudicator who's down the phone line.
Speaker 2 (14:47):
And everyone has to be can be a lot more
complicated though in terms of because sometimes there's a lot
of paper we're involved and you know, here's my copy
of this, and you know, so, yeah, it can be
more complicated, and you've you've got to be really organized,
and you've got to be good at making your case.
The adjudicator is a pretty good at being balanced. You
(15:09):
know that they're accustomed to having a bit of everything
come before them. You get some interesting decisions out of
them occasionally. But I can couldn't cut both ways. Really.
Speaker 3 (15:20):
Yeah, Look, we'd love to hear from you, just if
you are a renter, or actually even if you're a landlord. Actually,
have you ever been asked for a reduction, and what's
your approach being to it. What's the best way to
negotiate your rent? If you think that maybe you've got
a bit of a room to wiggle, or because I
think if you look, if you make a cheeky offer,
then see you later. So I think there's no such
(15:41):
thing as there wouldn't be any point in making anything
other than a reasonable offer. But you can add your
comment on that, Helen. Just as the music playing before
we go to the break, A big.
Speaker 2 (15:52):
Fan of the reasonable offer me.
Speaker 3 (15:54):
Okay, we'll be back in just a moment. It's twenty
two past four News Talk z B inside a clean instance.
Speaker 8 (16:05):
Thinne and welcome back to the Weekend Collective.
Speaker 3 (16:31):
This is one road you show what your calls on
eight hundred eighty ten eighty or text nine two nine too.
We're talking about how do you go about negotiating a
rent reduction? Look, possibly it's not the easiest game to
play right now, given the rents have gone down, but
just to put it in perspective, only five bucks to
six hundred and forty five a week. But you might
(16:51):
be one of those ones who you know on a
six hundred and forty five property. You're you thought I
wouldn't need the property and you're paying seven hundred bucks.
You want to have a chat with the landlord about it?
How do you go about it?
Speaker 7 (17:01):
Oh?
Speaker 3 (17:01):
Eight hundred eighty ten eighty right, let's go to some
calls Rod. Hello, I can't hear Rod for some reason,
so we just need to hound right, right, So I
just start again. Sorry, we just had a right block.
Speaker 6 (17:15):
So I've been alan ord, been there for some time,
well aware that much rather have my properties tenanted. The
losses that you do between tendencies, between tendencies cannot be
quite significant, particularly compared to any rein increase that might
be achieved. So I have very good tenants and one
on one properly owned. They had been there for over
(17:39):
two years, and they wanted to do some things, mind
the things inside which I'm entry to do coming to them. Okay,
that's fine, but we need to look at the rent
and so my sugistan to them was you have a
look at rents in the area, what you think you
can pay, and then we'll talk about So two or
(18:03):
three weeks later they said, okay, we thought about it.
We think we can afford thirty dollars a week. I
had in mind that I was going to ask for
forty dollars a week.
Speaker 3 (18:12):
Well, this is a non crise.
Speaker 6 (18:13):
You're talking about an increase. Yeah, that they were aware that,
you know, there's been signaltt increases in terms of insurance
and rates. So I said, okay, if that's you're comfortable
with that, then I would accept that. Thank you. I
thought they were very lucky because pretty soon after that
I would monitor Bodom lodgment with Bond Center, which has
(18:35):
got to be an indication of current rents, and at
that point the property was in number of bedrooms, et
cetera in that area another forty dollars, so forty plus
thirty seventy dollars more right rents in that area. So
they were lucky to negotiate a reasonable price quickly and
(18:58):
therefore avoid me reviewing it at an even higher amount,
which I thought would have been equitable market.
Speaker 3 (19:05):
I guess it's sounded like it all went reasonably well
as a negotiation because you both were trying to understand
each other's position.
Speaker 6 (19:12):
Is that right correct?
Speaker 7 (19:14):
Yeah?
Speaker 6 (19:15):
I mean I don't I know others who think they
should put in every year. I don't see what it is.
Certainly in terms of the costs that have come through Untald,
nothing that's in my control in the last three through
three or four years, saying that the rents are significantly
(19:36):
low compared to we started out.
Speaker 3 (19:41):
Yeah, Actually, you know the question that comes out of
all this in a way, and you've probably reflected that
a bit by accepting a lower increase than you're looking for.
How much is a good tenant actually worth? How do
you quantify? I think that's the that's the big question,
because I think much more it's a lot.
Speaker 6 (20:00):
Isn't it much more than trying to squeezed another twenty
or three dollars we out in one go. The time,
in my opinion, to go to a bit harder with
read is when a tendency changes. And I've said that
there's a costly process changing tenancies.
Speaker 3 (20:18):
Actually that is that is I think through that call
with Rod Helen, that is the question, isn't it? Because
all it boils down to is what is a good
tenant worth? And if your property is something that's quite
precious to you and you don't want to have to
worry about chasing people for the extra costs of repairs
or something, or what is a good tenant worth?
Speaker 2 (20:41):
That's well, a bad tenant can be catastrophically expensive, But
it comes down to whether or not do you think
there's another nice fish in the sea. How hard or
easy is it to find good tenants? And that's an
interesting it's a question that Tony Alexander asked and his
regular column which is published on one where you know,
(21:03):
they ask how asked land to rate how much easier
is it to find good tenants than it used to be?
And they you know, the negatives outweigh the positives, And
at the moment more landlords are saying it's harder to
find good tenants than I think we've seen in that
reading for a while.
Speaker 3 (21:21):
Actually, yeah, And I mean it's a very broad question
is what is a good tenant worth? Of course, but
it depends on the property and the rent and all
that sort of thing. But I guess how many weeks
rent is a good tenant worth? In terms of negotiating,
you know, if you're looking like if I'm going to
I mean, I don't know how you budgets as a landlord.
As an investor, some people will budget on the idea
(21:42):
that they're going to have it tenanted fifty two weeks
of the year. But that's alltalistic.
Speaker 2 (21:46):
Yeah, you've got to expect to have a couple of weeks,
but you've got to budget your numbers on having at
least a couple of weeks. Wagon If you don't have that,
then great, that is that's an upside, but you know
you've got to anticipate that. Therefore, you know, if you
think you might have up to two or four weeks rent,
that's what a good tenant, that's what a good home
occupy is worth to you. A couple of weeks to
(22:07):
or three weeks rent.
Speaker 3 (22:09):
Yeah, so, and of course it depends on the market.
But if the problem is finding a good tenant, then
then I yes, yeah, there's some room to move and
you and you would happily move if you think you
can get someone in there for a while.
Speaker 2 (22:22):
Yeah, Like a good property will generally always rent if
it's well kept and desirable. But there is again, having
had tenants over the years, I will go a long
way to keep a good tenant and a property. And
we saw it during the pandemic the business hose running
at the time. We had loads of occupiers who had
(22:46):
to come to us and say, you know, it's lockdown.
I've got literally six dollars left after I pay the rent.
Is there anything the landlord can do? And one hundred
percent of the landlords we went to came to the party,
and we're generous and human and made generous offers, looked
after their tenants. I think I thought was showed the
(23:09):
caliber of New Zealanders.
Speaker 3 (23:10):
And I think I also think that it's good to
hear that that's the bulk of the behavior of everyone,
because a lot of the time, well I think that
because you get so much contentious stuff introduced all in
the name of politics, and you can look at other
issues in society, including race as well, but it seems
that that a lot of the time, the conversation seems
(23:35):
to want us to decide who are the baddies and
who are the goodies, when in fact, you know there
are bad people in life on every in every every
part of the spectrum, but the average. In fact, that's
almost a good argument for having a landlord who you
have a direct relationship with, because if you are a
good tenant, then you are having a tough time and
(23:56):
you talk to that landlord, then the human relationship is
probably the one that wins out, isn't it.
Speaker 4 (24:01):
Yeah, I would hope.
Speaker 2 (24:02):
That the good property managers would do the same and
would actually advocate for a good ten in those circumstances
as well. And maybe I'm barst having run what I
think was a good property management business. We're used to
do promoters net promoters care surveys with our home occupiers,
(24:22):
and resoundingly you had something like a thought an incredibly
high rating from the people who are occupying the homes
we managed because we saw them as our customers.
Speaker 3 (24:32):
Well. Actually, the other thing is as a property manager,
I mean you are having a lot more to do
with the people who are in the property and the
person who owns it with both.
Speaker 2 (24:40):
Yeah, you do, you do. If you're doing a job properly,
you're communicating with both sides of the equation. But you
have customers and your customers customers, and it's critical they
actually have a good relationship with both of them.
Speaker 3 (24:52):
You're welcome to give us a call on that if
you've got any If you've you've got your reckons on
how you approach making sure that you're paying the right
rent or receiving the right rent. If you're a landlord,
I guess once you've tenanted it. One of the rules
around are you.
Speaker 2 (25:05):
Only able to do that the twelve months?
Speaker 3 (25:08):
And where all wet with the.
Speaker 2 (25:09):
Sorry a maximum of a minimum of twelve months between
rent increases?
Speaker 3 (25:13):
And where are we at with notice?
Speaker 2 (25:15):
Because I think it's still you.
Speaker 3 (25:18):
The notice provisions have remember you couldn't.
Speaker 2 (25:21):
Actually I don't think they have. They've announced. I think
that the tenancy build change it has been introduced, but
I don't believe it's pasted.
Speaker 3 (25:31):
Ye'd okay?
Speaker 6 (25:32):
Right?
Speaker 3 (25:33):
Because there is another thing we want to talk about,
and it's hopefully it's nothing, not a major subject in
terms of the number of properties that are actually in
this situation. Because I remember the days we'd opened the
property press, or back in the days.
Speaker 2 (25:48):
You remember the days of the property press.
Speaker 3 (25:50):
It's a long time ago, back twenty years ago, but
there would be a black and white section of the
paper and you could almost tell how the market was
doing was how many black and white pages there were,
And there was a time when there were a lot
being more sales. And the question is, I guess, is
a mortgage sale one way of getting a bargain or
(26:14):
is it? I asked that looking at you going what
youre giving that look like you idiot. Of course, it's
not that simple.
Speaker 2 (26:22):
I've gotta get to got to get a poker face.
Speaker 3 (26:26):
Yeah, But mortgage sales, I mean, of course, I think
the whole thing, the attitude of the market towards more
mortgage sales has changed since twenty years ago anyway, because
the last thing banks want to do, last thing anyone
wants is a mortgage sale. But I think now the banks,
my just casual observation would be that they really try
(26:48):
their hardest to keep that property in the hands of
the person who owns it.
Speaker 2 (26:52):
They try to avoid them because for the simple reason
it is incredibly it is very value destractive. Ultimately, if
the thing goes to if a property goes to a
mortgage sale, it means that the relationship between the bank
and the mortgage has broken down completely and it's the
only way to actually achieve realization or you know, tidying
(27:13):
up alone. And there's a real taint that comes to
them because people expect that they're going to get a
bargain because the mortgageaw gives so few warranties on sale,
so of course there is a price reduction that a
buyer would expect, but they can be incredibly complicated.
Speaker 3 (27:34):
It does feel like there's an element of a gamble
and buying any mortgage cell. Mortgage cell, wouldn't they be there's.
Speaker 2 (27:41):
Definitely risk here. You are, you are getting your you
know you're buying sometimes sight unseen and you're buying accepting
whatever you find when your dad is as wear as
So you want to be an experienced sort of an
investor and know what you're looking at before you decide
to jump. And I wouldn't rock up to one of
(28:02):
those on a Sunday afternoon and buy one just on
a casual wind.
Speaker 3 (28:05):
Put in that way, No, and I rest assured. We
do not have a mortgy property sale property as our
property the week either. It's although if it was a
mortgage sale, it looks so good you might take a
punt on getting a bit of a discount on it
because it's kind of price the property of the week.
It's a have you seen the property of the week.
Oh it's a ripper, isn't it. Anyway, we're going to
be back. We've got a caller waiting, so we'll be
back in just a tick. You can give us a
(28:27):
call on that. Have you ever bought a mortgage mortgage
at a mortgage sale, and did you learn any lessons
or was it just the best thing you ever did?
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Speaker 1 (29:38):
Years, property, parenting, politics plus health, money and the week's
figure issues. It's Home on the Weekend, connected with Tim Bebridge,
Use TALKSB.
Speaker 3 (29:50):
Yes, News Talks EB and my guest is held on
a Sullivan from Velocity. We're talking about a couple of things,
mortgage sales, the dos and don'ts or just avoid like
the plague. I don't know, obviously people don't. Otherwise there
wouldn't be such a thing as mortgage sales because there's
aways going to be a buyer, but also negotiating a
rent change if you think maybe you're paying too much.
Eight hundred and eight Francis Hello, Oh hello, how are
(30:14):
you doing? What would you like to what would you
like to ask or comment on?
Speaker 4 (30:19):
Oh? Yeah, you know, I just well, to be honest,
I'm on my way home from work and I just
thought i'd check in with a rent ease. Well a
rent rente Is that the right one? I don't know,
but I just thought i'd check in with a renterers
perspective on all of this, if that's okay.
Speaker 3 (30:41):
So I didn't quite catch that last one. Tenants is
a good way to put it with a tenants or what?
Speaker 4 (30:48):
Well, yeah, I'm a I'm a tenant. I've been flatting.
I'm I'm twenty seven years old right now, and I've
been flatter since I was about nineteen, and I just
thought i'd check in with you know, a renter's point of.
Speaker 3 (31:04):
View on yeah, and what's your point of view?
Speaker 4 (31:09):
Well, my point of view is a good landlord is
worth their weight in goals.
Speaker 3 (31:16):
Honestly, Oh so on the other side of the equation,
it's not about the value of a tenant, but a.
Speaker 6 (31:21):
Good landlord, yes, exactly.
Speaker 4 (31:24):
And you know a good landlord is worth their weight
in gold because you know, I've had my fair share
of awful landlords. I've had one who've come in and
rifled through my underwear jaw when I wasn't at home.
And yeah, it's it's been a whole learning curve.
Speaker 3 (31:47):
Does landlord, sorry, does that just does that just change
the way you you behave as a tenant or just
I don't know, it shouldn't change your way of behaving.
I'm guessing everyone just behaves themselves. But has it had
an impact on the way you approach I don't know,
the way you treat the property and and you're relationship
with the landlord.
Speaker 4 (32:09):
Actually it has slightly changed the way I behave in
the property, just you know, keeping things that I wouldn't
want my landlords to see, not like nothing, you know,
degrading or anything, just keeping my undies out of the
way and things like that.
Speaker 3 (32:28):
Yeah, that's good. It's good to keep the undies out
of the way. So I wasn't quite sure where that
conversation with Francis was going there. But anyway, no need
to comment to Helen because we've got another call to go.
Speaker 7 (32:40):
Jeremy, Hello, Yeah, you know, I just I thought i'd
tell you that year in the last even years, we've
bought twelve properties that have them a been more than
details and their ladies right. Is complicated and all the
switch properties we've made quite quite good profits out of them.
(33:02):
That is complicated. In terms of a couple of them,
I had to pay the owners to get out of
the properties. Another one was half down, but we were
able to still make money out of it. And so
there is there is it can't be problems, but then
(33:23):
there can't can't. Then you also can get situations where
it's empty the gold and you can just take it
over and then do it up.
Speaker 3 (33:33):
When you say when you say pay the owners to
get out of the property.
Speaker 2 (33:37):
You don't guaranteed vacant position when they're you're not guaranteed
vacant positions, so you may find it comes with someone.
Speaker 7 (33:46):
Yeah, you just take it over and if there's someone
in there, knock on the doors. Sometimes it isn't even
the owner, it's just someone living there. I can get
a lady who's living in one of my houses with
a dog and she just stayed there. Well, I did
it up, and then when we're I was going to
put on the market, I had to up here to
get out of it. Ended paying this money back.
Speaker 3 (34:09):
Sort of it's almost like a bribe. Is that almost
like a bribe in a way? I mean without sounding
that a lisit.
Speaker 7 (34:16):
It's not that there's enough. It's just business and it's
just people. I know some people excuse me of playing
on other people's misfortunes, but if I didn't, there's plenty
of other people out here. I go to some of
the mortgaging, so there's about twifty people here.
Speaker 3 (34:35):
Is he what made you buy your first mortgage property
and a mortgage, you know, abandoned property or a mortgage.
Speaker 7 (34:44):
Just because I was an investor. We with man, so
we just do this on the site and so it
came out pretty cheap. There was a half into our
house antiquately and I bought up to thirty four thousand
and then shipt to the house under house. Is it
(35:07):
sold for three fifty about a year and a half later.
Speaker 3 (35:12):
Are you?
Speaker 7 (35:13):
You can do really well out of them, but you've
got to pay text, You've got to be darst registered
all that plabor because you can't do anan. Revenue will
catch you. They will catch you if you do it
without it. But I do also because I've got a
proper background.
Speaker 3 (35:31):
So well, actually that was my next That was my
next question is that it wouldn't be your first mortgage purchase,
would not have been your first real estate purchase. I'm guessing.
Speaker 7 (35:47):
We've done about beady years we've been together. But yeah, no,
it isn't for the faint hearted. I know of some
people who bought two houses in it and prevent town
and saying people and they couldn't get them out in
(36:11):
the end they had to sell it back to the owners.
Had a product.
Speaker 3 (36:17):
Yeah, okay, hey, Jeremy, sorry, we just got a bit
of a dodgy line there. I just had to wrap
it up there. But yeah, it's a bit of a
cautionary tale, isn't it.
Speaker 2 (36:26):
Absolutely if you know what you're doing. And Jeremy sounds
like he's got all the skills that you need for
an endeavor like that.
Speaker 3 (36:33):
Actually, the relocatable homes is an interesting one, but that's
probably a whole nother, whole other of course, funnily enough
that I did look at that for my first house,
did you know, I don't know what. Twenty five years ago,
I didn't actually do it. I thought about a lot
of things happened.
Speaker 2 (36:55):
I looked at baring was absolute little shocker of a
door upper and a good friend of mine sat Helen.
Getting an A in third form woodwork is not qualification
you need for doing and doing wrapper.
Speaker 3 (37:08):
It's like, yeah, good point, yeah, good, Okay, Right, we'll
be back in just a moment. It's ten and a
half minutes to five news talk, saidb Yeah, so welcome
back to the One Roof radio show. My guest is
Helena Sullivan from Velocity. You can check their workout on
velocity dot co dot nz.
Speaker 7 (37:30):
Is that right?
Speaker 2 (37:30):
How we tack out the one roof website because we
are the one roof data partner.
Speaker 3 (37:34):
That's the one.
Speaker 2 (37:35):
All that lovely datas comes from us.
Speaker 3 (37:37):
Excellent, that's the one right now though, the day that
we care about is the fact that it is seven
minutes to five news Talk, said b.
Speaker 1 (37:45):
The one roof property of the week on the Weekend
Collective and.
Speaker 3 (37:49):
The one roof property of the week is Look, there
were always a ripper, so I don't know why. So
I don't know why I use the hyperbole because you
know it's always going to be a stunning property or
a very interesting one. This is an well it says.
It offers one hundred and eighty degree views of lake Walker, Tippoo,
the remarkables Mountain Range and Cecil Peak. The home perfectly
integrates indoor and outdoor living, featuring expansive tilled a tiled
(38:12):
patios ideal for hosting gatherings. It's a modern, open planned kitchen. Look,
it's a new, beautiful home. It's in four Lynch Lane
in Queenstown. I think it has a value of around
well the one roof. I'm struggling with the one roof
one roof estimate only because I know two point six
million dollars is a lot of money. But Helen, you
(38:34):
have seen the property and the views. I mean, it
just looks absolutely spectacular, doesn't it.
Speaker 2 (38:40):
The views are stunning. You would be engrave danger. I
think of spending most of your time just gazing vacantly
out the window.
Speaker 3 (38:46):
Yeah, I mean.
Speaker 2 (38:48):
Sitting in the hot tub gazing blissfully at those snowclad
mountains what called Gin and Tonic in here.
Speaker 3 (38:55):
Yes. So, in fact, when I looked at the listing,
I do think it's said there was an asking price
of four point something millions, So I think we might
be there might be.
Speaker 2 (39:02):
Yeah, No, I think the indicators more towards the three
million mIRC. One of the that the indication does come
with a medium confidence, which is kind of suggesting that
there's I mean, you know, the challenge is that those
are all algorithmically determined and the mathematics can't see their view.
Speaker 3 (39:27):
Yeah, it is absolutely spectacular, isn't it. Actually? You know,
the thing is, if you just about all of Queen's Town,
there are not many places that don't have some sort
of reason or viewer is there?
Speaker 2 (39:36):
That's true. It is just a pretty magical little spot.
Speaker 3 (39:40):
So anyway, thanks for thanks for joining us. You're going
to pop down to Queen's and make an offer on that.
Speaker 2 (39:45):
I am when the twenty six millions and I Hamish
Walker will be getting.
Speaker 3 (39:51):
Actually, I must say that does form part of my
business plan as well, given the twenty six mal is
it sex male? It's a snip. Thanks for Johnny us Allen,
always a pleasure to thank you for having me, and
as Helen says, of course, if you want to check
out the work that Velocity does, go and look at
the data and all the analysis and the information that's
on one roof, the one roof, one roof, dot co
(40:12):
dot nz And as I say, of course this because
this is the one roof radio show. We'll be back
with the parent squad next. This is news Talk z B.
It's coming out to four minutes to five.
Speaker 1 (41:23):
For more from the weekend collective, listen live to News
Talk sed BE weekends from three pm, or follow the
podcast on iHeartRadio
You're listening to the Weekend Collective podcast from News Talks
Ed Bassure.
Speaker 2 (00:39):
Yesterday was bad.
Speaker 3 (00:44):
And welcome back to the Weekend Collective. It is time
now for the One roofe radio show. We want your calls.
We'd love to have your participation on one highty ten
eighty in text on nine two nine two, And today
my guest is from Velocity with an A at the
start and her name is Hello Sullivant, Hello Helen, how
are you going?
Speaker 2 (01:01):
Good tim? I am great to thank you? How are you?
Speaker 3 (01:05):
Very good things and just explain a little bit for
those people who will have heard of Velocity about what
you guys do.
Speaker 2 (01:12):
Yeah, Velocity is a quibi o proptic that provides a
lot of valuation ordering and management software for banks. And
we also have a new product called Velocity Nexus which
we provide to the real estate industry, which is a
property research tool that real estate agents use to assess
and research their markets.
Speaker 3 (01:35):
And so for the average punter, what would they use
for them?
Speaker 2 (01:38):
For the average we don't have a consumer offering, but
what we are providing is parwering real estate agents. And indeed,
the one roof website is kind of kind of what.
Speaker 3 (01:47):
Brings me here, Tim, That is fantastic because we love
the one Roof website actually on the velocity on the
value side of things. So the first thing we want
to have a chat about is that, were you surprised
that trade Me data shows that rent prices are for
the first time in a couple.
Speaker 2 (02:06):
Of years, not surprised to see that that market is
definitely softening. Yeah, all my sources are telling me that
the rental market is definitely a lot softer than it
has been. Demand as low. I mean, that's normal for
this time of year anyway for some peculiar reason, and
Auckland people don't like shifting their stuff in pouring rain.
(02:28):
Go figure. Yeah, it's definitely softer than usual.
Speaker 3 (02:31):
It did surprise me because I think until recently the
immigration figures had shown this massive number of people who
are leaving and of course we're sort of importing people
to make up for that, but in fact, sorry, a
massive number of people still arriving as well. We had
in the past year some amazing immigration stats. But it
does surprise me that that hasn't well, it hasn't equated
(02:55):
to one a rise in property prices or rents, but
in terms of the rental price drop. How much of
that has to do with government policy because well, for instance,
the lack of deductibility was obviously to me a factor
in putting rents up, because you make it more expensive
to be a landlord, you're going to pass that on.
(03:15):
But is that a factor at all or not yet?
Speaker 2 (03:19):
I don't really think so, because the thing with rent
is that it's not really set by the costs that
the landlord is experiencing. It is mainly driven by the
market and what is achievable for that property. Most rental
properties do actually run out a cash loss.
Speaker 3 (03:38):
Okay, well, how about this then? Is the market driven
by the fact that overall for all landlords it was
more expensive too, you know, you couldn't deduct as much.
So is the market influenced by policies like that? And
we don't worry people, We're not going to make this
a discussion abound whether deductibility and text ductibility and all
that sort of thing is a good thing or not.
But I mean, if you take a macro view.
Speaker 2 (04:03):
Look, my macro view is my my experience of the market,
is that what landlords is, what is achievable in revenue
and rent is very much driven by the supply and
demand as opposed to input prices, which is where the
deductibility or otherwise comes in.
Speaker 3 (04:23):
Okay, So when they're talking about a drop in rental prices,
I guess that is we're not seeing people haggling their
rents down yet, are we? Would that be just as
new listings come up. We've just noticed that the average
price of new listings for rental is slightly cheaper.
Speaker 2 (04:42):
Now, I think it's more. Number one, we're not saying
rents continue to go up as they had been doing.
And number two, you if you spent a lot of
time monitoring rental sites, as geeks like me do, you
will see properties that have been on the market for
some time starting to drop in price. And then when
(05:06):
a new when new stock comes to market, they landlord
will probably managing when they're setting the rent We'll look
at what's being advertised around the area and in that space,
and they'll set their price accordingly. Yeah, because there's no
point in you know, it's surprising how price sensitive the
rental market is. If you overprice a rental property by
(05:28):
twenty or even twenty dollars, you will find that you
don't get inquiry for it.
Speaker 3 (05:34):
Actually, by the way, we should give these stat actually,
just because when you hear that rentals have dropped, it
makes you think, oh wow, how much. But it's a
month on month looks like it's a five dollars a
week drop to six hundred and forty five bucks, So
it's it's hardly plummeted or anything. But I guess it's
just a relief to people who are renting or looking
(05:57):
to rent that it's not this crazy market where you know,
you've got to go bid against it with other people
and or guess what, you know, another fifty bucks will
do it more.
Speaker 2 (06:07):
Than anything else. It's preferable to find yourself at an
open home with a horde of people, which I remember
doing in my bad old days renting, and you'd turn
up and there'd be fifty people standing outside the open home.
Speaker 3 (06:20):
You go, oh my god, Actually, actually I do. I
only remember that because when we rented, we bought the
place that we were renting. But when we rented it
and we had a couple hundred meters from Saint Helia's Beach,
and there was no one interested in looking at it
because it was an old it was old like the
day course you know, sort of that sort of eighties
pink sort of car.
Speaker 2 (06:43):
Yes, oh gosh, avocado.
Speaker 3 (06:46):
It was all pretty pastal and it was pretty dated
and all that. But the agent it was well priced,
but it was well priced, but no one was looking. Literally,
I didn't have to burd against anyone. No one was
looking at it. And I think I made an offer
for a bit cheaper than it was and the agent said, yeah, sure,
And I mean it was the best news ever. But
(07:07):
of course then you go forward ten years or something
and it's just it went nuts. What sees do we
ever have a sort of balanced market where maybe you've
got three or four in parties, it's not sure. What
is the happy medium? Do you think? Well, actually, the
happy medium depends on whether your renter, because the happy
medium for a renter is you're the only one interested
(07:29):
and it's nice and cheap. The happy medium for you
as a landlord is you've got people you know, fighting
to get the property, and more.
Speaker 2 (07:38):
Than anything else, you're keeping your you're keeping it occupied.
I mean, one of the things that we the counsel
that I always used to give landlords who you're wanting
to hang on for a higher price, it takes a
lot of weeks at twenty or thirty dollars a week
extra rent to pay for three or four weeks of
vacant occupation, and so you are far better to meet
(08:00):
the market in terms of the rental price and get
the property occupied.
Speaker 3 (08:04):
Actually that's not because that's quite a useful thing for
rents to bear in mind and remark like this. Then
that because if a property's been sitting vacant for a
couple of weeks and you're offering, say twenty bucks less,
it's worth make an offer. I mean it's worth that
because it's like trying to.
Speaker 2 (08:19):
Buy a house. You don't necessarily pay the asking. You'll
make an offer, so you know, you might get knocked back.
But how much does know who?
Speaker 3 (08:29):
Well, look at it this way, if it's.
Speaker 2 (08:30):
Doesn't cost you anything to get to know.
Speaker 3 (08:32):
For instance, if it's six hundred and fifty bucks and
you're thinking, you know what I'm going to ask, offer
them six one hundred and I don't know, ten or twenty.
I mean that's quite a few weeks that they would
have to make up for it. I mean, if they
had another couple of weeks vacant, that's probably worth the
landlord thinking, oh, you know what, you're a good tenant.
Speaker 2 (08:51):
You look reliable, Bengo, it's yours absolutely, and the same
when you've got tenants who are in situ and you're
looking at written rises. As a landlord, way better to
retain a good tenant than try and squeak an extra
at ten to fifteen dollars out of it and loser
a good sitting tenant. Have a few weeks back.
Speaker 3 (09:08):
We'd love to have your cause on this on how
you go about negotiating your rent when you're looking for
a property. But would you ever here's here's the big one,
and I don't to be honest, I'm not sure we're
really in this territory yet unless you are overpaying, unless
you're one of those tenants who I don't know, for
some reason, you look at your rent and you're going, wow,
we're paying way too much. Have you ever negotiated a
(09:29):
rental decrease? Have you ever back in your rental days?
If you've always Once you're in there, you're sort of like, oh,
well this is my budget, just keep paying.
Speaker 4 (09:38):
Yeah, well, I look.
Speaker 2 (09:39):
We've seen it happen, particularly when a property's value is compromised.
You know there's road works going on outside, or all
the buildings is under renovation, or you know, something's something
major happens. You know, we saw quite a bit of
it during post pandemic, when you know, particular in the
inner city there's a lot of vacancy. People who reached
(10:01):
the end of the e fixed to take a look
at trade me and go, karke place underneath me is
one hundred bucks cheaper than what I'm paying, and that's
a valid mart You know, ultimately, when it comes to rent,
you can appeal to the tendency tribunal and then and
say this is not market rent that I'm being changed,
and then you know, then it all comes down to
(10:21):
the evidence. What are some of the properties so renting
for around you? And it's pretty easy to find that
stuff on all the websites because.
Speaker 3 (10:29):
These days, actually I was thinking in the older days,
where more landlords manage their own rentals, that would be
a more awkward conversation, isn't But these days most I mean,
what do we know what proportion of properties are managed
by property managers?
Speaker 2 (10:43):
That data always used to say it was thirty to
forty percent. We're managed by property managers, And you know,
sort of sixty to seventy percent where self managed. Really,
I suspect things have changed, but it's really hard to
get a sense of what the you know, there's no
market share data that you can kind of reliably get.
But kiwis are very we're good deal. Oh wire is
(11:05):
right and in property management as much as anything else.
Speaker 3 (11:10):
That actually surprises me. But I guess because every I
think just about every expert that we've had or commentator
we've had in the studio when it comes to property investment,
the question around who should manage your property has almost
resounding I would say ninety five percent of the opinion
is that if you don't, if you just get someone
(11:32):
else to do it and avoid yourself a whole world
of headaches unless you are really really seasoned, have the
time to do it and the expertise, and you just
grate at it.
Speaker 2 (11:41):
Look, I'd totally agree, it's an incredibly complicated business these days.
You know, there's a lot of compliance and ultimately you're
in business, so there's a number of things that you
have to comply with, and my personal preference has always
been to pay someone else to work that stuff out
for me and take those you know, so that when
the sync overflowers or the toilet blocks on a Saturday
(12:04):
after no, I don't get the phone call.
Speaker 5 (12:07):
Yeah, actually, on that thing about if you are if
you do think you're in an apartment or a house
where you are paying too much, look the first price.
Speaker 3 (12:17):
The first step would be surely to talk to you
wouldn't go to the tendency to no, you wouldn't start.
I mean that's pretty I don't know a blunt instrument,
isn't it. So you talk to the landlord of the
letting agent and just say.
Speaker 2 (12:32):
First I gather the evidence, so you know, as opposed
to just going might reckon? Is I reckon I'm paying
too much? What are some of the properties in a
similar condition renting for around where you're living? Sometimes it's
really hard to find comparables. You know, you might have
the penthouse apartment, you might have the sort of the
(12:55):
dark thing on the corner on the corner of the block.
But there will be something. There will be There's always
data on on websites. One roof it has a great
mental set as well. Take a look at it and
see what some of the properties are renting for. Start
with data. As always, always my default position.
Speaker 3 (13:13):
Yeah, because I thinking if you're renting a house, the
comparisons are probably a bit more tricky, isn't it, Because
you could be a house on the same street. You
could be a three bedroom house on the same street
along with another three bedroom house, but you know, one
house might be I don't know, brand new bathroom, freshly decorated,
all that sort of thing. It's not so straightforward, is it.
Speaker 2 (13:33):
It's not straightforward, and that's why data and judgment comes
into it.
Speaker 3 (13:40):
And Okay, so you've had a chat with the landlord
and the letting agent and they've said, no, no, we're
not prepared for just the rent you signed up to it.
That was the market, and that is the market. If
you decide you want to take that further, then what
it is the tend to.
Speaker 6 (13:57):
Be in is it?
Speaker 7 (13:58):
Yeah?
Speaker 3 (13:59):
And so what's involved with that?
Speaker 2 (14:00):
Then filling in lots of forms, waiting your turn for
a hearing, attending the hearing, presenting your evidence. The landlord
or the leading agent would debtend the hearing as well,
present their counter evidence, and adjudicator listens carefully, blimey, and
(14:20):
then make the decision do.
Speaker 3 (14:21):
You have to actually turn up to the tenth stritripunal
in the flesh or is it done sort of, there's
a lot more of it.
Speaker 2 (14:27):
It's done remotely. They discovered that little handy technique during
during the pandemic, and then we went, why don't we
do this all the time. It's kind of a lot
easier and it's a lot less confronting.
Speaker 3 (14:40):
Actually, yeah, I imagine that would be, because that's half
the thing. You take the heat out of it. When
you've got an adjudicator who's down the phone line.
Speaker 2 (14:47):
And everyone has to be can be a lot more
complicated though in terms of because sometimes there's a lot
of paper we're involved and you know, here's my copy
of this, and you know, so, yeah, it can be
more complicated, and you've you've got to be really organized,
and you've got to be good at making your case.
The adjudicator is a pretty good at being balanced. You
(15:09):
know that they're accustomed to having a bit of everything
come before them. You get some interesting decisions out of
them occasionally. But I can couldn't cut both ways. Really.
Speaker 3 (15:20):
Yeah, Look, we'd love to hear from you, just if
you are a renter, or actually even if you're a landlord. Actually,
have you ever been asked for a reduction, and what's
your approach being to it. What's the best way to
negotiate your rent? If you think that maybe you've got
a bit of a room to wiggle, or because I
think if you look, if you make a cheeky offer,
then see you later. So I think there's no such
(15:41):
thing as there wouldn't be any point in making anything
other than a reasonable offer. But you can add your
comment on that, Helen. Just as the music playing before
we go to the break, A big.
Speaker 2 (15:52):
Fan of the reasonable offer me.
Speaker 3 (15:54):
Okay, we'll be back in just a moment. It's twenty
two past four News Talk z B inside a clean instance.
Speaker 8 (16:05):
Thinne and welcome back to the Weekend Collective.
Speaker 3 (16:31):
This is one road you show what your calls on
eight hundred eighty ten eighty or text nine two nine too.
We're talking about how do you go about negotiating a
rent reduction? Look, possibly it's not the easiest game to
play right now, given the rents have gone down, but
just to put it in perspective, only five bucks to
six hundred and forty five a week. But you might
(16:51):
be one of those ones who you know on a
six hundred and forty five property. You're you thought I
wouldn't need the property and you're paying seven hundred bucks.
You want to have a chat with the landlord about it?
How do you go about it?
Speaker 7 (17:01):
Oh?
Speaker 3 (17:01):
Eight hundred eighty ten eighty right, let's go to some
calls Rod. Hello, I can't hear Rod for some reason,
so we just need to hound right, right, So I
just start again. Sorry, we just had a right block.
Speaker 6 (17:15):
So I've been alan ord, been there for some time,
well aware that much rather have my properties tenanted. The
losses that you do between tendencies, between tendencies cannot be
quite significant, particularly compared to any rein increase that might
be achieved. So I have very good tenants and one
on one properly owned. They had been there for over
(17:39):
two years, and they wanted to do some things, mind
the things inside which I'm entry to do coming to them. Okay,
that's fine, but we need to look at the rent
and so my sugistan to them was you have a
look at rents in the area, what you think you
can pay, and then we'll talk about So two or
(18:03):
three weeks later they said, okay, we thought about it.
We think we can afford thirty dollars a week. I
had in mind that I was going to ask for
forty dollars a week.
Speaker 3 (18:12):
Well, this is a non crise.
Speaker 6 (18:13):
You're talking about an increase. Yeah, that they were aware that,
you know, there's been signaltt increases in terms of insurance
and rates. So I said, okay, if that's you're comfortable
with that, then I would accept that. Thank you. I
thought they were very lucky because pretty soon after that
I would monitor Bodom lodgment with Bond Center, which has
(18:35):
got to be an indication of current rents, and at
that point the property was in number of bedrooms, et
cetera in that area another forty dollars, so forty plus
thirty seventy dollars more right rents in that area. So
they were lucky to negotiate a reasonable price quickly and
(18:58):
therefore avoid me reviewing it at an even higher amount,
which I thought would have been equitable market.
Speaker 3 (19:05):
I guess it's sounded like it all went reasonably well
as a negotiation because you both were trying to understand
each other's position.
Speaker 6 (19:12):
Is that right correct?
Speaker 7 (19:14):
Yeah?
Speaker 6 (19:15):
I mean I don't I know others who think they
should put in every year. I don't see what it is.
Certainly in terms of the costs that have come through Untald,
nothing that's in my control in the last three through
three or four years, saying that the rents are significantly
(19:36):
low compared to we started out.
Speaker 3 (19:41):
Yeah, Actually, you know the question that comes out of
all this in a way, and you've probably reflected that
a bit by accepting a lower increase than you're looking for.
How much is a good tenant actually worth? How do
you quantify? I think that's the that's the big question,
because I think much more it's a lot.
Speaker 6 (20:00):
Isn't it much more than trying to squeezed another twenty
or three dollars we out in one go. The time,
in my opinion, to go to a bit harder with
read is when a tendency changes. And I've said that
there's a costly process changing tenancies.
Speaker 3 (20:18):
Actually that is that is I think through that call
with Rod Helen, that is the question, isn't it? Because
all it boils down to is what is a good
tenant worth? And if your property is something that's quite
precious to you and you don't want to have to
worry about chasing people for the extra costs of repairs
or something, or what is a good tenant worth?
Speaker 2 (20:41):
That's well, a bad tenant can be catastrophically expensive, But
it comes down to whether or not do you think
there's another nice fish in the sea. How hard or
easy is it to find good tenants? And that's an
interesting it's a question that Tony Alexander asked and his
regular column which is published on one where you know,
(21:03):
they ask how asked land to rate how much easier
is it to find good tenants than it used to be?
And they you know, the negatives outweigh the positives, And
at the moment more landlords are saying it's harder to
find good tenants than I think we've seen in that
reading for a while.
Speaker 3 (21:21):
Actually, yeah, And I mean it's a very broad question
is what is a good tenant worth? Of course, but
it depends on the property and the rent and all
that sort of thing. But I guess how many weeks
rent is a good tenant worth? In terms of negotiating,
you know, if you're looking like if I'm going to
I mean, I don't know how you budgets as a landlord.
As an investor, some people will budget on the idea
(21:42):
that they're going to have it tenanted fifty two weeks
of the year. But that's alltalistic.
Speaker 2 (21:46):
Yeah, you've got to expect to have a couple of weeks,
but you've got to budget your numbers on having at
least a couple of weeks. Wagon If you don't have that,
then great, that is that's an upside, but you know
you've got to anticipate that. Therefore, you know, if you
think you might have up to two or four weeks rent,
that's what a good tenant, that's what a good home
occupy is worth to you. A couple of weeks to
(22:07):
or three weeks rent.
Speaker 3 (22:09):
Yeah, so, and of course it depends on the market.
But if the problem is finding a good tenant, then
then I yes, yeah, there's some room to move and
you and you would happily move if you think you
can get someone in there for a while.
Speaker 2 (22:22):
Yeah, Like a good property will generally always rent if
it's well kept and desirable. But there is again, having
had tenants over the years, I will go a long
way to keep a good tenant and a property. And
we saw it during the pandemic the business hose running
at the time. We had loads of occupiers who had
(22:46):
to come to us and say, you know, it's lockdown.
I've got literally six dollars left after I pay the rent.
Is there anything the landlord can do? And one hundred
percent of the landlords we went to came to the party,
and we're generous and human and made generous offers, looked
after their tenants. I think I thought was showed the
(23:09):
caliber of New Zealanders.
Speaker 3 (23:10):
And I think I also think that it's good to
hear that that's the bulk of the behavior of everyone,
because a lot of the time, well I think that
because you get so much contentious stuff introduced all in
the name of politics, and you can look at other
issues in society, including race as well, but it seems
that that a lot of the time, the conversation seems
(23:35):
to want us to decide who are the baddies and
who are the goodies, when in fact, you know there
are bad people in life on every in every every
part of the spectrum, but the average. In fact, that's
almost a good argument for having a landlord who you
have a direct relationship with, because if you are a
good tenant, then you are having a tough time and
(23:56):
you talk to that landlord, then the human relationship is
probably the one that wins out, isn't it.
Speaker 4 (24:01):
Yeah, I would hope.
Speaker 2 (24:02):
That the good property managers would do the same and
would actually advocate for a good ten in those circumstances
as well. And maybe I'm barst having run what I
think was a good property management business. We're used to
do promoters net promoters care surveys with our home occupiers,
(24:22):
and resoundingly you had something like a thought an incredibly
high rating from the people who are occupying the homes
we managed because we saw them as our customers.
Speaker 3 (24:32):
Well. Actually, the other thing is as a property manager,
I mean you are having a lot more to do
with the people who are in the property and the
person who owns it with both.
Speaker 2 (24:40):
Yeah, you do, you do. If you're doing a job properly,
you're communicating with both sides of the equation. But you
have customers and your customers customers, and it's critical they
actually have a good relationship with both of them.
Speaker 3 (24:52):
You're welcome to give us a call on that if
you've got any If you've you've got your reckons on
how you approach making sure that you're paying the right
rent or receiving the right rent. If you're a landlord,
I guess once you've tenanted it. One of the rules
around are you.
Speaker 2 (25:05):
Only able to do that the twelve months?
Speaker 3 (25:08):
And where all wet with the.
Speaker 2 (25:09):
Sorry a maximum of a minimum of twelve months between
rent increases?
Speaker 3 (25:13):
And where are we at with notice?
Speaker 2 (25:15):
Because I think it's still you.
Speaker 3 (25:18):
The notice provisions have remember you couldn't.
Speaker 2 (25:21):
Actually I don't think they have. They've announced. I think
that the tenancy build change it has been introduced, but
I don't believe it's pasted.
Speaker 3 (25:31):
Ye'd okay?
Speaker 6 (25:32):
Right?
Speaker 3 (25:33):
Because there is another thing we want to talk about,
and it's hopefully it's nothing, not a major subject in
terms of the number of properties that are actually in
this situation. Because I remember the days we'd opened the
property press, or back in the days.
Speaker 2 (25:48):
You remember the days of the property press.
Speaker 3 (25:50):
It's a long time ago, back twenty years ago, but
there would be a black and white section of the
paper and you could almost tell how the market was
doing was how many black and white pages there were,
And there was a time when there were a lot
being more sales. And the question is, I guess, is
a mortgage sale one way of getting a bargain or
(26:14):
is it? I asked that looking at you going what
youre giving that look like you idiot. Of course, it's
not that simple.
Speaker 2 (26:22):
I've gotta get to got to get a poker face.
Speaker 3 (26:26):
Yeah, But mortgage sales, I mean, of course, I think
the whole thing, the attitude of the market towards more
mortgage sales has changed since twenty years ago anyway, because
the last thing banks want to do, last thing anyone
wants is a mortgage sale. But I think now the banks,
my just casual observation would be that they really try
(26:48):
their hardest to keep that property in the hands of
the person who owns it.
Speaker 2 (26:52):
They try to avoid them because for the simple reason
it is incredibly it is very value destractive. Ultimately, if
the thing goes to if a property goes to a
mortgage sale, it means that the relationship between the bank
and the mortgage has broken down completely and it's the
only way to actually achieve realization or you know, tidying
(27:13):
up alone. And there's a real taint that comes to
them because people expect that they're going to get a
bargain because the mortgageaw gives so few warranties on sale,
so of course there is a price reduction that a
buyer would expect, but they can be incredibly complicated.
Speaker 3 (27:34):
It does feel like there's an element of a gamble
and buying any mortgage cell. Mortgage cell, wouldn't they be there's.
Speaker 2 (27:41):
Definitely risk here. You are, you are getting your you
know you're buying sometimes sight unseen and you're buying accepting
whatever you find when your dad is as wear as
So you want to be an experienced sort of an
investor and know what you're looking at before you decide
to jump. And I wouldn't rock up to one of
(28:02):
those on a Sunday afternoon and buy one just on
a casual wind.
Speaker 3 (28:05):
Put in that way, No, and I rest assured. We
do not have a mortgy property sale property as our
property the week either. It's although if it was a
mortgage sale, it looks so good you might take a
punt on getting a bit of a discount on it
because it's kind of price the property of the week.
It's a have you seen the property of the week.
Oh it's a ripper, isn't it. Anyway, we're going to
be back. We've got a caller waiting, so we'll be
back in just a tick. You can give us a
(28:27):
call on that. Have you ever bought a mortgage mortgage
at a mortgage sale, and did you learn any lessons
or was it just the best thing you ever did?
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(28:47):
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(29:32):
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Speaker 1 (29:38):
Years, property, parenting, politics plus health, money and the week's
figure issues. It's Home on the Weekend, connected with Tim Bebridge,
Use TALKSB.
Speaker 3 (29:50):
Yes, News Talks EB and my guest is held on
a Sullivan from Velocity. We're talking about a couple of things,
mortgage sales, the dos and don'ts or just avoid like
the plague. I don't know, obviously people don't. Otherwise there
wouldn't be such a thing as mortgage sales because there's
aways going to be a buyer, but also negotiating a
rent change if you think maybe you're paying too much.
Eight hundred and eight Francis Hello, Oh hello, how are
(30:14):
you doing? What would you like to what would you
like to ask or comment on?
Speaker 4 (30:19):
Oh? Yeah, you know, I just well, to be honest,
I'm on my way home from work and I just
thought i'd check in with a rent ease. Well a
rent rente Is that the right one? I don't know,
but I just thought i'd check in with a renterers
perspective on all of this, if that's okay.
Speaker 3 (30:41):
So I didn't quite catch that last one. Tenants is
a good way to put it with a tenants or what?
Speaker 4 (30:48):
Well, yeah, I'm a I'm a tenant. I've been flatting.
I'm I'm twenty seven years old right now, and I've
been flatter since I was about nineteen, and I just
thought i'd check in with you know, a renter's point of.
Speaker 3 (31:04):
View on yeah, and what's your point of view?
Speaker 4 (31:09):
Well, my point of view is a good landlord is
worth their weight in goals.
Speaker 3 (31:16):
Honestly, Oh so on the other side of the equation,
it's not about the value of a tenant, but a.
Speaker 6 (31:21):
Good landlord, yes, exactly.
Speaker 4 (31:24):
And you know a good landlord is worth their weight
in gold because you know, I've had my fair share
of awful landlords. I've had one who've come in and
rifled through my underwear jaw when I wasn't at home.
And yeah, it's it's been a whole learning curve.
Speaker 3 (31:47):
Does landlord, sorry, does that just does that just change
the way you you behave as a tenant or just
I don't know, it shouldn't change your way of behaving.
I'm guessing everyone just behaves themselves. But has it had
an impact on the way you approach I don't know,
the way you treat the property and and you're relationship
with the landlord.
Speaker 4 (32:09):
Actually it has slightly changed the way I behave in
the property, just you know, keeping things that I wouldn't
want my landlords to see, not like nothing, you know,
degrading or anything, just keeping my undies out of the
way and things like that.
Speaker 3 (32:28):
Yeah, that's good. It's good to keep the undies out
of the way. So I wasn't quite sure where that
conversation with Francis was going there. But anyway, no need
to comment to Helen because we've got another call to go.
Speaker 7 (32:40):
Jeremy, Hello, Yeah, you know, I just I thought i'd
tell you that year in the last even years, we've
bought twelve properties that have them a been more than
details and their ladies right. Is complicated and all the
switch properties we've made quite quite good profits out of them.
(33:02):
That is complicated. In terms of a couple of them,
I had to pay the owners to get out of
the properties. Another one was half down, but we were
able to still make money out of it. And so
there is there is it can't be problems, but then
(33:23):
there can't can't. Then you also can get situations where
it's empty the gold and you can just take it
over and then do it up.
Speaker 3 (33:33):
When you say when you say pay the owners to
get out of the property.
Speaker 2 (33:37):
You don't guaranteed vacant position when they're you're not guaranteed
vacant positions, so you may find it comes with someone.
Speaker 7 (33:46):
Yeah, you just take it over and if there's someone
in there, knock on the doors. Sometimes it isn't even
the owner, it's just someone living there. I can get
a lady who's living in one of my houses with
a dog and she just stayed there. Well, I did
it up, and then when we're I was going to
put on the market, I had to up here to
get out of it. Ended paying this money back.
Speaker 3 (34:09):
Sort of it's almost like a bribe. Is that almost
like a bribe in a way? I mean without sounding
that a lisit.
Speaker 7 (34:16):
It's not that there's enough. It's just business and it's
just people. I know some people excuse me of playing
on other people's misfortunes, but if I didn't, there's plenty
of other people out here. I go to some of
the mortgaging, so there's about twifty people here.
Speaker 3 (34:35):
Is he what made you buy your first mortgage property
and a mortgage, you know, abandoned property or a mortgage.
Speaker 7 (34:44):
Just because I was an investor. We with man, so
we just do this on the site and so it
came out pretty cheap. There was a half into our
house antiquately and I bought up to thirty four thousand
and then shipt to the house under house. Is it
(35:07):
sold for three fifty about a year and a half later.
Speaker 3 (35:12):
Are you?
Speaker 7 (35:13):
You can do really well out of them, but you've
got to pay text, You've got to be darst registered
all that plabor because you can't do anan. Revenue will
catch you. They will catch you if you do it
without it. But I do also because I've got a
proper background.
Speaker 3 (35:31):
So well, actually that was my next That was my
next question is that it wouldn't be your first mortgage purchase,
would not have been your first real estate purchase. I'm guessing.
Speaker 7 (35:47):
We've done about beady years we've been together. But yeah, no,
it isn't for the faint hearted. I know of some
people who bought two houses in it and prevent town
and saying people and they couldn't get them out in
(36:11):
the end they had to sell it back to the owners.
Had a product.
Speaker 3 (36:17):
Yeah, okay, hey, Jeremy, sorry, we just got a bit
of a dodgy line there. I just had to wrap
it up there. But yeah, it's a bit of a
cautionary tale, isn't it.
Speaker 2 (36:26):
Absolutely if you know what you're doing. And Jeremy sounds
like he's got all the skills that you need for
an endeavor like that.
Speaker 3 (36:33):
Actually, the relocatable homes is an interesting one, but that's
probably a whole nother, whole other of course, funnily enough
that I did look at that for my first house,
did you know, I don't know what. Twenty five years ago,
I didn't actually do it. I thought about a lot
of things happened.
Speaker 2 (36:55):
I looked at baring was absolute little shocker of a
door upper and a good friend of mine sat Helen.
Getting an A in third form woodwork is not qualification
you need for doing and doing wrapper.
Speaker 3 (37:08):
It's like, yeah, good point, yeah, good, Okay, Right, we'll
be back in just a moment. It's ten and a
half minutes to five news talk, saidb Yeah, so welcome
back to the One Roof radio show. My guest is
Helena Sullivan from Velocity. You can check their workout on
velocity dot co dot nz.
Speaker 7 (37:30):
Is that right?
Speaker 2 (37:30):
How we tack out the one roof website because we
are the one roof data partner.
Speaker 3 (37:34):
That's the one.
Speaker 2 (37:35):
All that lovely datas comes from us.
Speaker 3 (37:37):
Excellent, that's the one right now though, the day that
we care about is the fact that it is seven
minutes to five news Talk, said b.
Speaker 1 (37:45):
The one roof property of the week on the Weekend
Collective and.
Speaker 3 (37:49):
The one roof property of the week is Look, there
were always a ripper, so I don't know why. So
I don't know why I use the hyperbole because you
know it's always going to be a stunning property or
a very interesting one. This is an well it says.
It offers one hundred and eighty degree views of lake Walker, Tippoo,
the remarkables Mountain Range and Cecil Peak. The home perfectly
integrates indoor and outdoor living, featuring expansive tilled a tiled
(38:12):
patios ideal for hosting gatherings. It's a modern, open planned kitchen. Look,
it's a new, beautiful home. It's in four Lynch Lane
in Queenstown. I think it has a value of around
well the one roof. I'm struggling with the one roof
one roof estimate only because I know two point six
million dollars is a lot of money. But Helen, you
(38:34):
have seen the property and the views. I mean, it
just looks absolutely spectacular, doesn't it.
Speaker 2 (38:40):
The views are stunning. You would be engrave danger. I
think of spending most of your time just gazing vacantly
out the window.
Speaker 3 (38:46):
Yeah, I mean.
Speaker 2 (38:48):
Sitting in the hot tub gazing blissfully at those snowclad
mountains what called Gin and Tonic in here.
Speaker 3 (38:55):
Yes. So, in fact, when I looked at the listing,
I do think it's said there was an asking price
of four point something millions, So I think we might
be there might be.
Speaker 2 (39:02):
Yeah, No, I think the indicators more towards the three
million mIRC. One of the that the indication does come
with a medium confidence, which is kind of suggesting that
there's I mean, you know, the challenge is that those
are all algorithmically determined and the mathematics can't see their view.
Speaker 3 (39:27):
Yeah, it is absolutely spectacular, isn't it. Actually? You know,
the thing is, if you just about all of Queen's Town,
there are not many places that don't have some sort
of reason or viewer is there?
Speaker 2 (39:36):
That's true. It is just a pretty magical little spot.
Speaker 3 (39:40):
So anyway, thanks for thanks for joining us. You're going
to pop down to Queen's and make an offer on that.
Speaker 2 (39:45):
I am when the twenty six millions and I Hamish
Walker will be getting.
Speaker 3 (39:51):
Actually, I must say that does form part of my
business plan as well, given the twenty six mal is
it sex male? It's a snip. Thanks for Johnny us Allen,
always a pleasure to thank you for having me, and
as Helen says, of course, if you want to check
out the work that Velocity does, go and look at
the data and all the analysis and the information that's
on one roof, the one roof, one roof, dot co
(40:12):
dot nz And as I say, of course this because
this is the one roof radio show. We'll be back
with the parent squad next. This is news Talk z B.
It's coming out to four minutes to five.
Speaker 1 (41:23):
For more from the weekend collective, listen live to News
Talk sed BE weekends from three pm, or follow the
podcast on iHeartRadio
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