All Topics / General Property / Investing in NZ

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  • Profile photo of ceecceec
    Participant
    @ceec
    Join Date: 2004
    Post Count: 1

    I’m new to this game and would appreciate some advice. NZ looks extremely attractive as a country where you can purchase low cost +ive geared properties.

    What is the current state of the property market in NZ. Is it booming, static or depressed. I suppose it possibly depends on the region, town etc.?

    What does GV mean. Is this simmilar to a local council rates assesent in Australia. Eg land value for rates purposes.?

    Has anybody dealt with individuals offering bird dogging facilities and if so what was your experience.?

    I like the idea of starting an investment portfolio with a cheaper property with little or no loan. Seems like less risk to me. However normally cheaper means nastier and riskier?

    Any thoughts would be much appreciated. Would like to hear from you if you have invested in NZ and your experiences.

    CEEC

    ceec

    Profile photo of RouquinRouquin
    Member
    @rouquin
    Join Date: 2004
    Post Count: 3

    <edited by Admin – Information is the key – feel free to advertise in your signature, but please provide something of value in your post – admin>

    Rouquin

    Profile photo of CastleDreamerCastleDreamer
    Participant
    @castledreamer
    Join Date: 2003
    Post Count: 288

    Hi ceec

    For reputable birddogs in NZ!!! I recommend Minimogul and Westan, both members on the forum here. You can contact them by using the PM function. Both have been members here for some time, I have met or spoken with both of them, and trust them. Westan is in the south island, mini in the north.
    Cheers
    CD

    CastleDreamer

    Profile photo of BEAR1964BEAR1964
    Participant
    @bear1964
    Join Date: 2003
    Post Count: 702

    I would also recomend Minimogul and Westan. I also believe Brent the office manager at propertyinvesting.com is planning a trip in the near future to offer his services.

    Regards Bear

    POSITVE CASHFLOW properties and Joint Ventures available!
    For the BEST deals register via E-mail [email protected]
    DONT MISS OUT!!!!!

    Profile photo of drinksbunnydrinksbunny
    Member
    @drinksbunny
    Join Date: 2004
    Post Count: 8

    Hi Ceec

    GV stands for government valuation – it is used to calculate the rates and also some banks will use it for lending without having to get a valuation. Having said that I have found that GV’s can be wide off the mark so would always go for a valuation.

    Obviously it depends on the area when discussing the NZ RE market. We have a property in the BOP, North Island, we brought it about 10 years ago, the following 5 years showed a very nice rise in value, but then it stayed static for about 4 years and just started rising in value again last year. From friends I have talked to (who still live there) and some real estate agents I know it should continue to go up for a while. Other area’s – who knows???

    I’ve read Westan and Minimogul’s posts on this site and I think talking to them would be a good first step.

    My husband’s from the BOP and we go over regularly as my parents are living there as well, so if you come across any area’s over there feel free to PM me and I’ll let you know abit about those areas.

    Otherwise it’s a great place to visit, a holiday with a tax write off hmmmm:)

    drinksbunny

    Profile photo of muppetmuppet
    Member
    @muppet
    Join Date: 2003
    Post Count: 900

    Hi Guys

    GV has been replaced with RV which is Rateable Value and is used by the Councils to charge you a fee for owning property.

    Rateable Value should not be confused with Registered Value which is an amount a Registered Valuer says your property may be worth at that moment.

    These two values are frequently vastly different. Particularly in area that is having a lot of capital growth.

    To find out which areas of NZ are doing well buy, beg or steal a copy of the KPI Magazine which updates values from around the country every month.

    For a list of useful web sites have a look at this link:
    http://www.propertytalk.co.nz/modules.php?name=Forums&file=viewtopic&t=241
    Regards

    Profile photo of KiwiZenaKiwiZena
    Member
    @kiwizena
    Join Date: 2004
    Post Count: 10

    Hi Ceec

    I’ve just moved over to Aust from Christchurch, a city I’d call a great IP beginner city. Now I know a lot of people disagree with investing in the south island, (theres a far greater proportion of people up north) but I feel that the northern prices are currently at the top of their peak – still positive, but when you work out the potential return, a property down south makes more sense. (with the exception of Nelson, that has been saturated – wait 12-24 months and you should be able to buy some mortgagee sales there) One of my Christchurch properties just returned me a pleasant 112% capital gain (in 4 years, and no CG tax) and the prices are still less than Auckland. I have yet to have an un-tenanted period of over a couple of days in any property, so thats another plus for Christchurch. Places like Ashburton, and Gore, traditionally scorned, but have got booming industries, and people who like to rent. Interest rates are still good, equity can be used from here, and it might pay to look into the tax agreements between here and there, as I am able to write a proportion of my Australian income tax off on my NZ properties.
    If you need to know about anywhere in the south, feel free to ask – promise I won’t be biased, but remember, all the better rugby players come from the south!

    For something a little different, why not check out http://theinvestingcrew.com

    Profile photo of Tasman PropertyTasman Property
    Member
    @tasman-property
    Join Date: 2003
    Post Count: 126

    Hi Ceec, welcome to the forum.

    I am investing in NZ, north island. To put it simply, its booming here right now. In fact I’ve just adjusted my investment criteria as I was missing out on some great deals by being too selective. Now its all going well and I am about to purchase another investors portfolio in one go.

    The way I see it is that by the end of this year there will be little left in the way of +CF deals. Just like in Australia, if it meets the 11 sec rule now, by the end of the year the price could rise and it will no longer meet this rule. (See Steve’s book if you havent heard about this).

    So its important to get in quickly, and that’s why I moved here from Sydney to invest.

    Let me know if I can help in any way.

    I’m in the MAP, and can provide +CF deals in NZ for a fee. Email me for details.

    Profile photo of recoverymanrecoveryman
    Member
    @recoveryman
    Join Date: 2003
    Post Count: 122

    Hi
    I have only one word to say
    wanganui
    recovery

    “I should be content to look at a mountain for what it is and not as a comment on my life” D. Ignatow

    Profile photo of nmcacenmcace
    Participant
    @nmcace
    Join Date: 2003
    Post Count: 16

    What are people’s opinions on serviced apartments and the like. I was looking in NZ and made a conditional offer on a +ve geared one, went through the due diligence and found that the body corporate insurance excluded water damage and the building had plumbing problems. I’ve been told that this is apparently a common problem in the NZ cities – has anyone else experienced this?

    Profile photo of SiboSibo
    Participant
    @sibo
    Join Date: 2003
    Post Count: 126

    I think NZ coastal property is a great long term prospect for capital gains. If it is +CF it will be hard to lose. Think about the state of the world now, how it is likely to move, and then think that NZ is an unspoiled paradise with still much cheap coastline.
    Regards,
    Si

    Profile photo of brentbrent
    Participant
    @brent
    Join Date: 2001
    Post Count: 165

    Because I have a lot of deals go over my desk at the moment, I’m seeing a bit of the NZ market right now.

    I’m shocked at some of the things Australian investors are buying.

    Agents know that Aussies are willing to buy sight unseen, and are usually prepared to buy (funnily enough) at Steve’s 11 second solution calculation! (around 10-10.4% yields). These deals are being snapped up within days – often with 2 or 3 offers within a day if the listing agent knows a few investors up north or across the Tasman.

    Chatting with an agent I know in Invercargill (way down in Southland), he’s now saying that with so many investors hitting the market, it’s begining to get harder to rent properties.

    This is not to say that you shouldn’t be buying in NZ (or that you SHOULD be buying for that matter)

    I would recommend that anyone looking to invest (in NZ or otherwise) take on three key points.

    1. Always, Always, ALWAYS do your due diligence – get something which backs up every assumption you have made.
    Put clauses on the contract which say you won’t settle until these assumptions have been proven.
    (PS – don’t just put in a finance clause and have this cover everything. Often this loses you credibility – be honest and transparent right from the start, and more often than not the Agent will do whatever he or she can to help you, and get the deal across the line)

    2. Consider bringing someone onto your team who knows a little bit about the market, and can understand how the subtleties work. Perhaps a bird-dogger like Tasman Investor or Mini in the North, Westan or Myself in the South.
    (Don’t be a tyrekicker and pump these people for information though – if they’re good enough to help you and be on your team, they’re good enough to be paid for their time.)

    3. Don’t get swept up in the deal. There’s kazillions of them out there – in Oz and abroad. Even though people like ‘Tasman Investor’ talk about changing their investing criteria because too many deals are slipping through his fingers – this doesn’t mean you need to go for the first positive cashflow deal you see.
    Positive Cashflow deals are not scarce – and neither are investors whom agents know can be whipped into a frenzy and will possibly make a bad decision.

    So keep a cool head, and know what you’re getting into.

    Brent Hodgson
    PropertyInvesting.com
    Admin Manager

    I’m going on a property buying tour!

    Want to receive the e-mail diary of my trip, hear about some of the great Positive Cashflow deals I find, and perhaps discover some great opportunities for yourself? e-mail or PM me!

    Profile photo of tamaratamara
    Member
    @tamara
    Join Date: 2003
    Post Count: 56

    Hi

    No matter whether you invest in oz or nz you need to do your due dilligence and remember there will always be another good deal just around the corner.

    As we are based in neither nz or oz I find myself doing the same due dilligence.

    Tamara

    Profile photo of SiboSibo
    Participant
    @sibo
    Join Date: 2003
    Post Count: 126

    I agree – whithout due diligence any purchase, ahywhere, under whatever conditions is risky.

    Regards,
    Si

    Profile photo of Tasman PropertyTasman Property
    Member
    @tasman-property
    Join Date: 2003
    Post Count: 126

    Great tips Brent!

    I feel that one of the bigger risks is to the uninformed investor that buys in NZ without really knowing the market here. Specifically:

    1. Someone who buys over the net or phone from Australia (still cant believe people do this).

    2. Someone who flies over, hires a car for a week and does a whirlwind tour to buy properties in places they’ve never heard of before. Still better than 1 i guess…

    I speak from experience, as I did the whirlwind tour last November when I was considering moving over. I could have bought then, but knowing what I know now I am glad I held back (well except that the prices are moving up so fast!). Who knows what I would have bought! And if there’s a problem its harder to fix in a different country…

    Westan has moved over here, Mini lives here, Brent has been over a few times with Steve and Dave to buy properties, I live here. personally I think the bird dog idea is a great win/win as you can leverage your time to find and buy a good +CF deal in NZ without the hassle of airfares, car hire and taking a week or two out of your shcedule to achieve a whirlwind tour as in (2) above.

    You may pay a few thousand dollars for a good deal, but you’ve saved the same in travel costs and time, and your spotter will probably have negotiated the same or more off the purchase price anyway!

    Better still, work with a spotter as part of your investing team to build a portfolio in NZ – not just 1 or 2 deals. They’re still so cheap here (for now) that if you have $50K to invest, you can buy 4-5 deals in one go and do all your finance and settlements all at once. Much easier.

    John [biggrin]

    (I believe that later this year there will be no +CF deals left in NZ. If you’d like Steve’s MAP protege living in NZ to leverage your time and find the deals to build your portfolio quickly, just ask me!)

    Profile photo of travellertraveller
    Member
    @traveller
    Join Date: 2004
    Post Count: 1

    hi there
    I know exactly how you feel…I was in the same position as u are now..interested in buying over in NZ but felt that i knew to little to invest.
    A friend of mine told me about this company that do all the research for you and provide u with a due diligence kit on the area and the property itself.
    why don t u start there.. have a chat to them
    http://www.positivelygeared.com.au

    Good luck
    Chris

    Profile photo of geogeo
    Member
    @geo
    Join Date: 2003
    Post Count: 1,194

    very very useful info – thaks to all who contributed

    kind regards,
    George

    “If You never never ask, you’ll never never know”

    Profile photo of westanwestan
    Member
    @westan
    Join Date: 2002
    Post Count: 1,950

    Hi all thanks to those who have said positive things about me.
    Kiwizena i couldn’t agree with you more, the south island is booming economically and the old data just doesn’t show it. Lucky some are finding out what is happening by visiting the place instead of reading the Cenus data for 1997 etc.
    i just want to endorse what others have said i see it on a daily basis foreign investors paying 5k or more than they need to to buy a property. Do your checks first, saddly even visitors in NZ for a few days, end up paying too much sometimes. Nothing can beat the time you should be spending finding out what properties have sold for in an area before you buy.
    Personally i wouldn’t buy a home unless it was under market value at worse market value but to pay more thats just stupidity. I should add that its not just foreign investors who are making some bad decisions on the prices they pay the locals can be just as stupid.
    protect yourself and spend time looking at the market.
    regards westan

    I find +ve cashflow deals in New Zealand which I sell to other investors. To be on my database send an e-mail to [email protected]

    Profile photo of dejaWCDdejaWCD
    Member
    @dejawcd
    Join Date: 2003
    Post Count: 3
    Originally posted by Brent:

    Because I have a lot of deals go over my desk at the moment, I’m seeing a bit of the NZ market right now.

    I’m shocked at some of the things Australian investors are buying.

    Agents know that Aussies are willing to buy sight unseen, and are usually prepared to buy (funnily enough) at Steve’s 11 second solution calculation! (around 10-10.4% yields). These deals are being snapped up within days – often with 2 or 3 offers within a day if the listing agent knows a few investors up north or across the Tasman.

    Chatting with an agent I know in Invercargill (way down in Southland), he’s now saying that with so many investors hitting the market, it’s begining to get harder to rent properties.

    This is not to say that you shouldn’t be buying in NZ (or that you SHOULD be buying for that matter)

    I would recommend that anyone looking to invest (in NZ or otherwise) take on three key points.

    1. Always, Always, ALWAYS do your due diligence – get something which backs up every assumption you have made.
    Put clauses on the contract which say you won’t settle until these assumptions have been proven.
    (PS – don’t just put in a finance clause and have this cover everything. Often this loses you credibility – be honest and transparent right from the start, and more often than not the Agent will do whatever he or she can to help you, and get the deal across the line)

    2. Consider bringing someone onto your team who knows a little bit about the market, and can understand how the subtleties work. Perhaps a bird-dogger like Tasman Investor or Mini in the North, Westan or Myself in the South.
    (Don’t be a tyrekicker and pump these people for information though – if they’re good enough to help you and be on your team, they’re good enough to be paid for their time.)

    3. Don’t get swept up in the deal. There’s kazillions of them out there – in Oz and abroad. Even though people like ‘Tasman Investor’ talk about changing their investing criteria because too many deals are slipping through his fingers – this doesn’t mean you need to go for the first positive cashflow deal you see.
    Positive Cashflow deals are not scarce – and neither are investors whom agents know can be whipped into a frenzy and will possibly make a bad decision.

    So keep a cool head, and know what you’re getting into.

    Brent Hodgson
    PropertyInvesting.com
    Admin Manager

    I’m going on a property buying tour!

    Want to receive the e-mail diary of my trip, hear about some of the great Positive Cashflow deals I find, and perhaps discover some great opportunities for yourself? e-mail or PM me!

    **************
    dejaWCD
    **************

    Profile photo of TorachanTorachan
    Member
    @torachan
    Join Date: 2004
    Post Count: 68
    Originally posted by ceec:

    I’m new to this game and would appreciate some advice. NZ looks extremely attractive as a country where you can purchase low cost +ive geared properties.

    What is the current state of the property market in NZ. Is it booming, static or depressed. I suppose it possibly depends on the region, town etc.?

    What does GV mean. Is this simmilar to a local council rates assesent in Australia. Eg land value for rates purposes.?

    Has anybody dealt with individuals offering bird dogging facilities and if so what was your experience.?

    I like the idea of starting an investment portfolio with a cheaper property with little or no loan. Seems like less risk to me. However normally cheaper means nastier and riskier?

    Any thoughts would be much appreciated. Would like to hear from you if you have invested in NZ and your experiences.

    CEEC

    ceec

    I’d keep in mind that NZ is a foreign country. Similar but different laws, different currency which fluctuates, racial issues. At anytime the NZ govt may change the laws regarding foreign ownership of property and you can complain all you like but believe it or not there are a few Kiwi’s who’d love to stick it to an Aussie.

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