The findings of the April 2014 NZ Property Investors’ Federation membership survey reveal that the typical property investor is likely to be over 40 years of age (although some respondents are in the 20-30 age group), to have been investing in property for at least 17 years and is undertaking regular repairs and maintenance. This typical property investor is likely to be managing his or her own properties, selecting the tenants and doing the regular property inspections. Not surprisingly, membership of the local property investors’ association has often been for more than five years, with more than a third being members 10 or more years.
The reason for this continuous membership is likely to be that the investor has been able to learn about building and managing a property portfolio from the association’s educational programme of speakers and workshops while enjoying the networking with other successful property investors.
Property investors’ association members from around New Zealand had been invited to participate in the survey through an email sent to them on the 4th of April and a reminder email two weeks later. At the close of the survey, 723 members had responded. This represents almost a quarter of the national membership.
The city in which respondents have the most properties is Christchurch, closely followed by Dunedin and Auckland. Hamilton is the leading regional city of choice for this group’s property investment and Tauranga and Palmerston North are next equal. However, respondents have investment properties in 31 other centres and the total value of their properties throughout New Zealand is $1,590,000,000. On average half this value is equity and half is debt, demonstrating that members have excellent equity levels.
Although more than half of their properties are aged between 1956 and 1995, these respondents have been actively looking after their properties, spending on average 8.7% of rental income on repairs and maintenance. Expenditure on the interior of the properties and on appliances and fittings was matched by the level of combined expenditure on the exterior, roofs, guttering and windows. A third of respondents had purchased heaters for their rental properties in the last year. Over 90% of the properties had some form of insulation and further insulation had been added to 13% of properties over the last year.
In two thirds of the cases, disputes taken to the Tenancy Tribunal have been about rent arrears and about a quarter have been about damage to the properties. However the majority of respondents had only been to the Tenancy Tribunal once or twice in five years.
A third of the respondents had purchased a property in the last financial year but more had considered doing so. Increasing interest rates was the most frequent reason given for a change of mind. There is more optimism regarding the outlook for the value of the property market in the future with only a small percentage feeling that the value will decrease. Nearly two thirds think that the property market will increase in value.
The survey was conducted through the Survey Monkey tool, with 56 questions over 6 pages. It is planned to repeat this survey each year.