Investment Information Guide

A rental property’s asking rent is only one part of its financial picture. Before buying or reviewing an investment property, consider the expected income, ongoing costs and work the home may need. Use this online guide to prepare questions for your property manager and professional advisers.

Start with the property and its likely rent

Ask for a rental appraisal that considers the home’s location, size, condition and comparable rental properties. An appraisal is an informed estimate; it is not a promise of rent, occupancy or future returns. Discuss any work needed before a tenant can move in with property manager Sharon Morton.

Build a realistic ownership budget

Include mortgage costs, rates, insurance, maintenance, management fees and possible vacancy periods. Allow for larger repairs and any work required to meet tenancy standards. Check the actual property records and obtain quotations where needed instead of relying on a general allowance alone.

Understand what a yield figure leaves out

A gross rental yield compares annual rent with the property’s purchase price or value. It does not account for ownership costs, borrowing, tax or changes in value. Use the same basis when comparing properties, and ask your adviser to assess the cash flow and risks for your circumstances.

Check finance and tax with the right adviser

Discuss lending with your lender or mortgage adviser and tax treatment with your accountant. Inland Revenue explains the current residential rental property interest rules. The rules and your circumstances can affect what applies; this page does not provide personal financial or tax advice.

Plan the management of the tenancy

Read our landlord information guide and property-management services to prepare for the practical side of ownership. Contact Ray White Tuakau to discuss the property and the information needed for a rental appraisal.