Multi Coalition formed: 7 policies impacting Property Investors
The Coalition is formed.
Landlords and tenants now have clarity on key issues affecting them both. Namely;
#1 The path back to full mortgage interest deductibility has been sped up
National’s election manifesto said investors would have been able to claim 50% in the current tax year, 50% in the 2024/25 tax year, 75% in 2025/26, and finally 100% in 2026/27.
Now, the Coalition will allow investors to claim 60% this tax year, 80% in 2024/25 and 100% in 2025/26. This will be welcome news for investors struggling with high interest rates.
There is light at the end of the cash flow tunnel.
#2 No news should mean good news for brightline test
So far there has been no word from the Coalition on this policy, which suggests that National’s policy of reducing the threshold from 10 years to 2 years will pass into law.
#3 Foreign buyer tax got the axe
Winston got his way here and National’s controversial policy will not see the light of day.
#4 The 90-day notice is back
The no cause 90-day notice will again allow landlords to end periodic tenancies without reason or applying to Tenancy Tribunal.
In practice, such notices are rarely used and instead the fact that the 90-day notice is available will encourage Property Managers and landlords to give a chance to tenants who might not have the best application or credit history.
#5 28 days becomes 21 days
If a tenant wishes to move then they will only need to give 21 days’ notice, instead of the current 28 days.
#6 Vacant possession also sped up
If a landlord is selling the property then the notice period given to the tenants will reduce from 90 to 42 days.
#7 The Renting Life of Pets
‘Pet Bonds” made the 6 o'clock news and are to be introduced to encourage landlords to look more favourably towards pets.
Damage by pets is already covered by the bond so we don't see much impact here.