Short supply of houses increases rents and creates working poor
"The last few years have seen record population growth which has caused a sudden need for extra housing" said NZPIF Executive Officer, Andrew King. "While the focus has been on house prices and first home buyers, little attention has been paid to the drastic need for extra rental accommodation".
This fact demonstrates that, while the Salvation Army has said that high rents are creating the working poor, the problem is also one of insufficient supply of rental housing.
A tenant told the Herald newspaper that "years ago it was easy to get a home, but now it is so hard".
Approximately 85% of rental properties in New Zealand are provided privately. Most of these are supplied by ordinary Kiwi's trying to provide for their retirement. Around 75% of rental property owners have just one property.
Rental property providers have been unfairly judged and criticised over recent years, with cost increases, regulatory changes and poor court decisions making it extremely hard to provide homes for people.
It currently costs around $6,500 a year to buy and provide the average New Zealand property as a rental. This is on top of the purchase price for the rental and this will increase to over $10,000 a year if ring fencing proposals are introduced.
"We need to realise that rental property providers are an essential part of providing housing in New Zealand" says King. "The harder we make it to provide homes for the tenants, the harder and more expensive it will be for tenants to find homes."
For further information please contact:
Andrew King, Executive Officer, NZ Property Investors’ Federation
Ph: (09) 815 8645, Mobile: 021 216 1299