Marlborough Property Investors' Association
The lack of new listings on the market suggests property investors “don’t really give a damn” about the April 1 tax changes that affected investment property, according to BNZ economist Tony Alexander.
In his latest BNZ Housing Market Update Alexander said new data showing a fall in July listings suggested, "Investors don't really give a damn about the rule changes earlier this year and are not dumping their properties."
Recent data from Realestate.co.nz and Barfoot & Thompson pointed to a fall in new listings and Alexander said that during July just 8,966 new listings came to market, compared to 10,586 a year earlier, 10,733 in July 2009 and 11,206 in July 2008.
"The price implications further down the track are fairly obvious though before then it will be rents which move upward at an accelerating pace," he said.
Alexander's comments were echoed by Independent Property Managers Association (IPMA) president Martin Evans.
"I think investors are sitting on their properties," he said.
Evans said changes to depreciation hadn't prompted existing property investors to exit the market but had proved a deterrent to new entrants.
"When they want to get into the market they have to do calculations as to how much profit they're going to make, depreciation was part of that, now they're going to get say $25 a week less, the thing might not stack up."
Evans said the introduction of a capital gains tax would have a far greater impact on the market than the depreciation changes.
"A capital gains tax would affect people buying, but depreciation won't affect selling. Depreciation only affects people buying because when they put all their figures together, it'll be harder for a property to stack up."
Source: Landlords.co.nzcomments powered by Disqus