The rental shortage in Tauranga

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A Mortgage Broker's Perspective... 

Tauranga is such a unique place to live. We have fantastic weather, beaches, shops and the people bring together a fantastic community and lifestyle. This, combined with the fact that we have nowhere near the traffic problems that other centres have, makes Tauranga a very attractive location to make your forever home. 

When I worked at the Bank, Tauranga was THE place that bankers and mortgage lenders wanted to be transferred to, to see out their remaining working years. 

If you’ve been paying attention to local Tauranga news, you’ll already be aware that over the last few months the number of properties being sold in the Tauranga area has increased significantly. In fact there is still a shortage of properties available to meet the demand. This has resulted in a significant lift in property values over the last year, according to Quotable Value and other valuation agencies I deal with. 

A lot of this is due to the Reserve Bank Lending Restrictions and the significant demand from Auckland Investors as a result of this.

We can now see evidence that the shortage in properties available for purchase, is also now being reflected in the number of houses available for rent in Tauranga.

According to this article the rental shortage in Tauranga is unlike anything seen here before, and the average asking rent has also increased.

The formula is quite simple. If there are more people looking to buy or rent here in Tauranga, compared to the number of places available, then the price of the house or rent, increases.

What does this mean for the future? Think about how much you were paying for a similar house or weekly rent 10 years ago. I bet you will notice that there is a significant difference now compared to then.

What do you think the prices of houses/rent will be in 10 years’ time? Probably a lot higher again!

Looking at how much a house will cost you in mortgage repayments if you purchased now, consider that amount to be locking in your repayments in the future.

It will insulate your household budget from increased payments in the future to a large extent (interest rate rises excluded in this statement).

So for your future financial security, there are a number of reasons why property is still a great investment over the long term.

  • It makes sense to own a house, so that you can lock in your regular accommodation expense and protect it from increases in the future.
     
  • When the value of the property increases, you can re-borrow against the equity in the property to purchase an investment property.
     
  • As a property investor, the tenant is meeting the majority of your investment property commitments. As rents rise over time, your income rises.

With the help of us as your mortgage broker, you can keep an eye on the finance world and make sure you are getting the best deal for your finances, your family and your future.

Find out how you can use property to build wealth, or if you have any friends or family that would be interested in a chat with us, please touch base with us to arrange an appointment!