March 2017 Newsletter - 1st Mar 2017

March 2017 Newsletter Hello,

Our busy summer rental season is starting to slow down with enquiries dropping, and the number of tenants turning up to viewings reducing (for most properties).  The majority of our properties have now been tenanted as we head into autumn. Although with all this lovely sunny weather we are getting in Nelson it still feels like summer – long may it last.

Pendulum starts to swing back in favour of landlords:
Last year a Tenancy Tribunal adjudicator ruled in favour of a tenant that was renting a property in Foxton, where the tenants dog had ruined the landlords carpets by urinating all over them. The landlord clearly felt particularly aggrieved because the tenant had been forbidden pets at the property and this had been included on the tenancy agreement. The adjudicator ruled that the damage was not intentional and referred to the Osaki case which found that tenants cannot be held liable for  unintentional damage. The Landlord appealed to the District Court and won with the District Court judge ruling that the way the tenant was living in the property they must have known that the property was being damaged and as a result the damage could be deemed to be intentional. Hallelujah! Thank the stars for common sense. We hope now that this District Court ruling will be binding on the ‘lower’ Tenancy Tribunal. Watch this space.

Interest Rates – Fixed versus Floating?
Mortgage holders should fix at three years: We like to follow the views and predictions of BNZ economist Tony Alexander. He’s not always right (what economist is) – but we think he bats above average with his predictions and advice. Here’s what he had to say recently about interest rates.  We think his advice about splitting your mortgages over fixed and floating is ‘appropriate’.
“Last year we saw rising bank funding costs and higher US bond yields following victory for Mr Trump. This prompted a rise in NZ home mortgage lending rates.
“Will this pace of rises continue? You cannot rule it out because we simply don’t know to what extent policy changes by President Trump will boost US growth and inflation and the pace of tightening of US monetary policy. This is a new source of global uncertainty for the financial markets and something which people should take into account when considering their management of interest rate risk.
“In a nutshell it has become more risky to sit with the bulk of your mortgage floating and/or fixed for only one or two years.
“If I were borrowing at the moment I would have one-quarter to one-third floating and the rest fixed three years at 5.09%. If you are conservative then you might jump to five years at 5.79%.”

Rental Disbursement
The next rental disbursement will be on the 15 March 2017 for mid-month and the 3 April 2017 for the end of month.
Kind regards,
Haven Property Management.

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