Kawerau No 1 suburb for property investment in NZ

Date published: April 10, 2013 at 10:19 am | Comments

Kawerau has ranked number 1 in QV,s statistics for Property Investment Suburbs in NZ.

Kawerau might not be top of your list of local holiday destinations, but there’s one statistic Kawerau can boast that makes the town look very attractive indeed, at least to property investors that is. With a gross yield of 9.3%, Kawerau takes first place for the highest performing rental properties in QV,s latest to 100 yields. Median property values in the town are just $101,000 and median rents $180.

Debra Gibbons, a property manager for First National says “you can buy a home for a low as $40,000, and get high market rents of $180 per week rent.”

At the top of the list Kawerau embodies on of the first principles of investing: with risk comes reward. Many of the best-performed areas when it comes to rental yields are in risky areas – and not all investors want to take those chances.

“You’ve got to be a tough landlord to deal with kind of problems you find in Kawerau” says local investor Caroline Pearson, “There are lots of beneficiaries and yes Kawerau has its share of trouble but I dont consider it a risky place to invest, so long as you give tenants good deadlines and check the bad tenant list, I wont let them stay if they dont pay their rent”

“The returns are huge but its not for everybody” Prices have bottomed out, she says “They are half what they were two years ago.” But on the bright side “prices can double overnight”

The Government is spending millions in Kawerau, in partnership with a strong local council, trying to make it a happy safe place. But the problems just wont go away that easily.

Excerpt for New Zealand Property Investor Magazine

Source: NZPI Magazine