Absentee landlord to sell houses as costs bite

A house in Venus St, Invercargill, owned by absentee landlord David Altena, who lives in Auckland.
A house in Venus St, Invercargill, owned by absentee landlord David Altena, who lives in Auckland.

@devlincolle: An absentee Invercargill landlord, whose properties in the city are becoming shabby, has decided to sell his portfolio because of distance and recurring costs.

Auckland businessmen David Altena and Julian Owen are the owners of Shiva Properties Ltd.

The pair have a residential portfolio of nine homes in the city, which they remotely manage from Auckland through an Invercargill property manager.

Mr Altena said he had had been buying the properties since 2007 and had great plans for them.

Although they were making returns on the properties, there were factors working against their investments, he said.

Distance had resulted in high management costs and their pockets were not deep enough to achieve their vision, he said.

Day-to-day maintenance added up to about $45,000 a year because he was not in the region to do the work himself.It was a challenge to balance costs with what he could do and what tenants were prepared to do.

He said he did not want empty properties to be an eyesore in Invercargill as had happened with some absentee landlord.

"Unfortunately we were naive getting into the property market and it has taken a lot more capital than we realised and the global financial crisis has not helped," Mr Altena said.

He said his properties were starting to fit the "typical absentee landlord description of shabby" and he had to let them go.

Invercargill Deputy Mayor Darren Ludlow said absentee landlords were businesspeople who should know the costs of getting involved with running a venture. Although there had been problems in the past with absentee landlords not taking care of their properties, they were no more problematic then other landlords, Mr Ludlow said.

Run-down or derelict houses in the city were a mix of absentee and regional landlords.

Late last year South Alive co-ordinator Janette Malcolm said the organisation had had issues with absentee landlords not looking after properties. She believed investments pushed up property prices and did not bring benefits in the form of people or businesses.

Recent Invercargill City Council figures show 66 per cent of properties in south Invercargill were south Invercargill owned, 11 per cent owned by people elsewhere in Invercargill, 19 per cent owned by people outside the city and 3 per cent foreign owned.

Southland District Council figures obtained yesterday show out of 20,730 properties, 17,685 are owned by ratepayers with an address in Southland, 2797 are owned by a ratepayer with an address in New Zealand but outside of Southland and 248 are owned by ratepayers with an overseas address.

Figures in 2012 showed most absentee landlords in the south lived in Australia and the North Island.

There were 504 absentee ratepayers in the Gore district, with 47 living overseas. About 30 lived in Australia.

Invercargill City Council figures showed that for the 2011-12 financial year, 40 of the 352 absentee landlords lived overseas and 36 of those were in Australia.

The Southland Times