FireCaesarMember@firecaesarJoin Date: 2004Post Count: 71
Thought I’ll start a thread that compares property investing in New Zealand versus Australia…
One advantage I see so far is not having to pay stamp duty in New Zealand and that will already save you several thousands in the bag.
What else do we have?
Looking for another income source? – Email me.westanMember@westanJoin Date: 2002Post Count: 1,950
Lets look at issue number 2 CashFlow.
As far as investing for cash flow NZ walks all over Oz, even after the huge price growth the country has had. I often mention that i’m selling in NZ but i would still consider buying if the right deal came along. I wouldn’t even consider buying an investment property in Oz at the moment.
USA information evenings in Melb, Syd and Brisbane in early April, email me for more info. We find cash positive deals showing 15-25% Returns in the USA email me at [email protected] to join our databaseFireCaesarMember@firecaesarJoin Date: 2004Post Count: 71
1) You’re saying the CF is still superior even after the recent growth? (What’s the typical annual ROI in N.Z after expenses?)
2) Is there any more upside/growth potential for N.Z in general (esp. Invercargill) in the next few years?
3) Why wouldn’t you consider Oz?
4) Are there any other advantages besides stamp duty and superior CF?
Looking for another income source? – Email me.MiniMogulParticipant@minimogulJoin Date: 2002Post Count: 1,414
NZ Versus Aus.
typical ROI we are buying in NZ is 10 percent + depending on the town. We will ‘stoop’ to 9.5+ for the right deal in the right town.
I recently purchased a 15.6 ‘with problems’ but then again I love problems, because as my Master taught me, aka steve, problem + solution = profit!
however we are able to find 10 percent deals without too many problems at all and an upside to boot.
NZ has many negatively geared investments too which can still be excellent buying, In fact I bought one in October which has doubled in value since then with more to come.
I think there is still considerable gains to be made, just like Australia kind of ground to a halt but Queensland zoomed ahead, NZ has the same kind of thing with some areas and types of investments slowing down or going backwards (expensive properties, 800k plus beachfront bare land, brand new apartments in Auckland) and some properties still zooming ahead (undervalued towns with high yields and ‘something happening’ in the area.)
“Is there any more upside/growth potential for N.Z in general (esp. Invercargill) in the next few years?”
Haha, well I never really vibed Invercargill and certainly wouldn’t buy there now, it seems overvalued in my opinion rather than undervalued which is what I try to buy, but Westan who knows about a thousand times more about the town than I do, and is a much bigger investor than me, always vibed it. I am not sure if he would tell you to buy there now though, partly cause he is doing the US now.
>Why wouldn’t you consider Oz?
Lack of CF+ve properties. So people seem to say judging from the amount of ‘where are the CF+ve properties’ posts.
I wouldn’t buy (personally) a negatively geared property at this point in the market and as far as ‘add value’ techniques you can do them anywhere, and NZ is much easier because I know the market so well and costs are cheaper (generalising) and things are easier (generalising) -talking councils, etc
>Are there any other advantages besides stamp >duty and superior CF?
Yes at least 50 (more about that soon!)
One of the biggest is that *in certain circumstances* there is no CGT in NZ when you sell.Don NicolussiParticipant@donJoin Date: 2005Post Count: 1,086
Hi Firecaesar,2) Is there any more upside/growth potential for N.Z in general (esp. Invercargill) in the next few years?
You can still find 10% properties all over NZ. I recently achieved that in Invercargill with 3brm/brick – well located – nothing to be done.
Part of the equation is knowing the market you are buying in. The PM we use assessed the rent at $20 higher than the selling agent and found us a tenant who moved in on settlement day.
One phrase that seems to have caught on with the agents around the South Island is “10% dreamer”. eg “thank heavens you are not another 10% dreamer” or “desperate aussie investor”.
I am still very positive about the NZ market, however, if you wish to buy on your own make sure you are willing to fly over a go home empty handed. If not you will pay to much and agents will smell this desperation all over you.
If you are willing to spend the time to build some relationships and due your DD you will find good deals everywhere.
Is there an upside? Looking into my crystal ball…probably! However, I think this will very much depend on the individual investor.
Good luck.GeoffBeckMember@geoffbeckJoin Date: 2003Post Count: 95
Advantages of investing in NZ over Australia.
Cost of repairs. Tradesmen costs are considerably cheaper in NZ compared to Oz. One down side is some towns have long lead time to get works done due to a lack of tradies.
GeoffBDon NicolussiParticipant@donJoin Date: 2005Post Count: 1,086
HI Geoff,One down side is some towns have long lead time to get works done due to a lack of tradies.
This can be a problem and we have experienced this. One negative experience we have had is with a smaller place that needs a bit of work.
Asked pm to get some quotes and she came back saying that the locals were to busy to quote and would only do blank cheque jobs.
Found this a bit weird so made the necessary calls. Low and behold she was right. Got the old I can go there and do the job but I wont and do have time to do estimates.
Bit of a shock but I am sure this will be a short term situation. Either more tradies will make themselves available or demand will slow down a bit.
I am sure I will find someone to do this job (with a quote first) or we will just do it ourselves.
Ah…the challenge. Just adds to the experience.
Good Luck.GeoffBeckMember@geoffbeckJoin Date: 2003Post Count: 95
Another advantage of investing in NZ over Oz is:
Bob Carr and his Treasure are not in power, therefore no land tax and NO vendor tax…. (Yet!!!)
GeoffBHux001Member@hux001Join Date: 2003Post Count: 108
Hi Don and Liz,
I’m also waiting for tradesmen to get work done in NZ. Settled on one property a month ago and still waiting for works to be done in order to rent out. Many towns in the same situation from what I gather.aptamParticipant@aptamJoin Date: 2004Post Count: 61Cost of repairs. Tradesmen costs are considerably cheaper in NZ compared to Oz.
Given the discussion above, if there are a lack of tradies, wouldn’t that just point to a supply imbalance?
That just says higher prices/blank cheque jobs. If tradies are cheaper in NZ compared to Oz then I wouldn’t think that would last too long…