The Southland Rental Market.
We are pleased to report that the rental market in Invercargill remains robust, with a high level of interest from prospective tenants. In particular, 3-bedroom properties in the Hargest school zone continue to be in high demand. Below is SRE property managements enquiry numbers for the past 30 days.
This month, we were delighted to welcome a new investor who purchased a property on Salford Street. The property received an impressive 42 enquiries within the first week of being listed, and the tenant was secured and moved in within just two weeks of the new owners taking possession.
The average rent in Invercargill is on the rise, with the median rent for a 3-bedroom property currently at $450 per week. The rental range is between $428 in the lower quartile and $500 in the higher quartile.
In other news, the latest report from REINZ has revealed that Invercargill is the third highest performer in terms of capital gains and rental yield. Our rental yield currently sits at 4.6%, and capital gains have increased by 0.2% from $439,000 to $440,000.
Is your insurance fit for purpose?
We recently assisted an owner with a casual let and encountered an interesting scenario. The owner was unable to gain insurance on their unit when they went to renew and update their policy.
The unit is part of a group of six units situated in the middle, all owned separately and not part of a body corporate. In an effort to gain some insight into this issue, we contacted Real Landlord Insurance, and here is the response we received:
“It is important to understand that Insurance is always making changes, and with weather events and natural disasters, we may see more changes to policy coverage and acceptance of business.
There are a couple of reasons why your landlord was not offered insurance over this unit/apartment.
- Strata Title. Often landlords are unaware that their property falls under strata title and the insurance is covered within the Body Corporate fees. We are finding this a lot with the increasing of multiple houses/units in blocks that landlords are not being informed at the time of purchase that they are under Strata Title and are simply unaware of this.
- The other situation is where they are not under any Strata Title and are individually owned and individually insured. You may find that one insurer will offer cover and one won’t. In most cases if they are in a block of up to four you should be able to obtain insurance without any problem, however when you start to have units or multi houses in blocks of more than four, it comes down to each individual Insurers ability to write business, which depends on who the Insurer’s Reinsurer is, and the restrictions that the Reinsurance places on writing business.
REAL Landlord offers Insurance cover on houses/units and we are able to offer to a maximum of five in the block. If there are more than five, we may still be able to help however we may require additional information including the position of the unit within the block and then we can refer the business to our Underwriting Team.”
It is a good reminder to check your own insurance on your investment property. It is important to ensure that you are covered for potential risks and losses that may occur. Some key considerations include whether you are covered for loss of rent, if you require a meth test between tenancies, if you are covered for intentional damage by a tenant, and if you have any coverage for gradual leaks.
At Real Landlord Insurance, they offer comprehensive coverage for any tenant-related incidences. However, it is important to note that they only insure properties that are managed by a property manager. If you would like to learn more about Real Landlord Insurance and their coverage options, please do not hesitate to let us know. We are happy to provide more information and help you find the best insurance coverage for your rental property.