Average house prices went up nearly 20% in Napier over the past year. This has a lot to do with interest from Aucklanders forced to look further to get the right rental return. A 6% yield is still possible in Napier, a home to the annual Art Deco festival, which brings tourists in from far afield.
I headed down there about a year ago, looking for the right rent return. At a 6% gross rent return, one million in houses means a safe $60,000 in income as opposed to about $40,000 or less in Auckland.
An area of interest was Tamatea on the western side of Napier. This bordered on some very sought after areas – Green Meadows and Taradale.
We found an old four bedroom house, listed at around the $290,000 mark with a rent of $330pw. It had some fairly basic cladding and was in slightly worn state. After a little haggling with the help of a thorough building inspection we bought this for $265k. The tiles in the bathroom were shabby and cracked. The laundry, kitchen and dining room all had exposed board for flooring.
The total cost of the do up came to approx $7k and this increased the rent to a healthy $370 pw (7% gross yield).
Free Presentation on Napier
Wolfgang our property manager has been an awesome help down there over the past two years. Ensuring the four houses I have secured are setup right from day one.
He is flying up to share his knowledge of the area.
When: 29th of this month 6.30 pm – 7.45 pm
Where: Level, 2/101 Station Rd, Penrose, Auckland 1061
