Future rental income
Question from Wendy updated on 10th July 2020:
I am doing retirement forecasting for 15 years' time and want to gauge how much rental income our rental properties will generate in the future. Are there any future forecasted average rental amounts available? If not, would it be fair to look at the graphs from the past and assume the same rental increases over time?
Our expert Kris Pedersen responded:
NZ Property Investor magazine has good information in regards to rental changes broken down into suburbs and then the actual change over a 12 month and a five year period. Note that you can’t use this and assume that what has happened previously will be similar to what happens in the future.
Inflation is tracking very low and events around Covid, including increased unemployment, may keep rental increases lower as this may result in lower income increases for a period of time. Areas which have had considerable growth around new infrastructure are likely to experience different amount of growth than those already established areas and an area which has had a large amount of new supply may also experience variances that history will not indicate
Kris Pedersen of Kris Pedersen Mortgages is a commentator on property and finance. His team sources top finance strategies. www.krispedersen.co.nz
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