The rental rebalance
Zac Snelling Head of Property Management Ray White New Zealand
New Zealand ’ s private rental sector is entering 2025 with a shifting balance of supply and demand , creating new opportunities for landlords and tenants , says Ray White New Zealand ’ s Head of Property Management , Zac Snelling .
“ Back in February , I wrote that quality rentals were in short supply , costs for tenants were climbing , and layers of regulation were weighing heavy on the sector . While the latter is still somewhat true , conditions today feel far more favourable , with supply and demand striking more balance and opportunities on both sides of the coin
beginning to bud .
“ But just like a garden , our market requires more than just sunshine to thrive . It demands careful planning , ongoing attention , and the right tools to ensure it remains productive .
“ As we look ahead to 2025 , landlords , investors , and tenants need to stay atop the shifting landscape , navigating regulatory changes and economic trends that will continue to shape the sector ,” he says .
NAVIGATING REGULATORY CHANGE
One of the key drivers of optimism across the sector has been the introduction of the Residential Tenancies Act ( RTA ) amendments , which are expected early in the new year .
Snelling believes these amendments will provide greater certainty for both landlords and tenants , particularly in regard to clearer lease terms and a strong framework for pet requests in tenancies . The former could take effect almost immediately , while pet-related rules are expected to be phased throughout 2025 , adding complexity for private landlords to navigate .
“ Additionally , with the July 2025 deadline for Healthy Homes compliance approaching , landlords must act now to avoid scrambling for materials and services . Many property owners may find value in professional property management services that ensure all new standards are met and maintained during this time .
“ For some time , my team and I have urged our landlords to get up to speed with regulatory changes now , especially to avoid issuing incorrect notices or failing to comply with new standards . The risks of fines , penalties and operational disruptions are significant and can have long-term financial and reputational consequences .”
THE ECONOMICS OF PROPERTY MANAGEMENT
Beyond compliance , economic change has had the most significant bearing on the industry . Snelling notes that higher interest rates and inflationary pressures slowed investor appetites in 2024 , but the anticipation of further rate reductions and tax policies could reinvigorate the market .
“ Following a staggered reintroduction , landlords can claim 100 per cent of their interest expenses on rental investment from April 2025 , meaning many are now in a stronger financial position . This reintroduction of tax incentives is expected to help restore investor confidence , spark activity , and ultimately increase tenants ’ housing choices .
“ Given the current economic climate , property management fees remain tax deductible , presenting a strong case for landlords to use professional services to stay compliant and maximise portfolio returns in the long term .”
PROPERTY MANAGERS IN AN EVOLVING MARKET
Snelling says the number of property managers in New Zealand has increased by over 50 per cent in the last 10 years . As demand for skilled professionals increases , so does the need for education and training within the sector .
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