Property Investors Snapping Up Auckland Homes

Even as Auckland’s property prices continue to rise, property investors have been busy snapping up and purchasing new properties for their portfolios. First home buyers have been complaining saying they are the ones who are missing out on these lower end priced properties because of the Reserve Bank’s LVR which means they need to save a higher deposit to get a mortgage.

What first home buyers are finding is that the rising property prices are giving property investors more equity in their existing portfolios which they can use to put together higher priced deposits. It is then easy for them to take advantage of the great deals offered to borrowers with high deposits. Also because there are fewer buyers in the market, investors are also more likely to not have to enter a bidding war, so end up paying less for their new property.

What Auckland areas are popular with property investors?
Property prices vary depending on not only the type of building and the land it is on, but also the location it is in. The number of bedrooms, suburb location, population growth and demand for rental properties are just some of the factors property investors will look at when deciding which new property to purchase.

As South Auckland is one of the areas with a booming population, investors are keen to boost the number of investments they have within it. Suburbs such as Otara, Manukau, Mangere and Manurewa North have a high demand for rental properties but also have lower property values. This makes these areas very popular with investors as they get a higher rate of return on their investments.

Will property investors be penalised for owning multiple properties?
With property investors being used as part of the reason for a shortage of available and affordable properties in Auckland and around New Zealand, the Reserve Bank has said they are looking into ways to increase the available housing stock. One of the measures they are considering is charging investors with five or more properties a higher interest rate on their mortgages, which in theory will help boost the number of properties within the reach of first home buyers.

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