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Bach owners say rental income vital

New Zealand bach owners who rent out their properties earn an average $12,513 a year, a new survey has found.

Tuesday, March 11th 2014, 12:00AM

by The Landlord

The research, done by booking websites Bookabach, Holiday Houses and Bachcare, was designed to provide information for local councils’ decision-making on tourism and visitor accommodation policies.

There are moves around the country to restrict holiday house rentals. The Thames Coromandel District Council is considering restrictions as part of its district plan.

The survey of more than 2000 bach owners found that a typical holiday rental was occupied for 25 nights a year by the owners and their family members, and rented out for an average of 60 nights.

Owners received between $4000 and $16,000 a year in rental income.

The median property was a $440,000, three-bedroom free-standing bach or holiday
home accommodating up to seven people. More than half the properties surveyed were owned individually or by groups of owners, 31% were owned by a family trust.

When asked about how important the rental income was to them, 73% of respondents agreed (56% strongly) that without holiday rental income they could not afford to keep or maintain a bach. And 79% agreed (61% strongly) that without it they could not afford to renovate or improve their properties.

The holiday rental owners on average spend $2500 a year on rates; $3113 a year on maintenance; and have spent $30,587 in the past five years on improvements and renovations. “Holiday rental maintains and improves the housing stock in many remote regions - and supports local tradespeople,” said Bachcare founder and general manager Leslie Preston. “In addition to this there is the direct benefit of the domestic tourism spend – which we haven’t attempted to quantify in this survey.”

She said unless renting out a holiday house remained an economically viable option, fewer Kiwis would be able to support owning a bach – and be forced to sell. That would put downward pressure on house prices in an already depressed market with less demand if new purchases are unable to rent.

« Christchurch rents put squeeze onRules affect landlords, too: NZPIF »

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ICBC 5.65 3.85 3.95 3.89
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Kiwibank Special - 3.55 3.59 3.99
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.69 4.79 -
Resimac 5.30 4.86 4.14 4.19
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