Don NicolussiParticipant@donJoin Date: 2005Post Count: 1,086
At the outset investing long distance is completely different to investing in your own back yard. Some people will tell you it is easy and there are no problems. Well that is just rubbish. It’s harder because you are not there to “know” things which puts pressure on how you do things and also on how you perceive things – this can be just as big a problem. ie if things are going great and you a stressed about it then long distance is not the way to go.
Culture is different – property management is a bit different but the same in many respects – rates are about 8.5% plus gst some cheaper some dearer and the level of service you get will be different all over the place – same in any country I imagine.
The market – well in some areas it is absolutely going off and in other areas it is dead and buried.
It is like oz – you can’t compare perth with sydney or in sydney you don’t compare cabramatta with bondi beach and double bay – or anywhere in the world you simply have to know where to buy – know the market and know the lay of the land. If you are buying now I would go fixed rates as they are heaps cheaper than the standard variable. The technicalities of doing business in NZ are pretty easy.
Gore and matarua are both very small places – I live near by to both and have never been tempted to buy there – but on the other hand know lots of people obviously do.
Banking is easy and probably the easiest banking you will find anywhere. You can open an account no problems and finance to ozzies at standard rates at 90 lvr is very much common place these days. Closing costs – legals 1000 to 1200 not much else. Loan establishment etc. Whatever they are. Maintenance will be more expensive because you are not there – fact of life.
There is another good forum http://www.propertytalk.co.nz. Use the search function on there and you will find out more than I could ever tell you in one post – what’s hot – what’s not.
Taxes – get a good accoutant early on. Depreciation here is fantastic at massive rates even on old dwellings – ie you can write of cost of dwelling starting new from the day you get it. Runs along the same basic lines. As an individual – the ATO wants a share of your worldwide income. No capital gains tax BUT (and many people forget this or just hope and pray) if you are in the business of buying and selling you SHOULd pay tax accordingly. If you buy with the intention to buy and hold and sell later then as long as that is the genuine intention at the time you are okay BUT get this part done first.
If it was me and I was starting now I would
* read as much as I can
* pick a few target areas and do a few trips for research
* before the trip find a good accountant and lawyer and drop in to see them – rugby is the only sport people are interested in here
* Also meet your broker
* these local people will tell you alot about the lie of the land and there fees will be worth there weight in gold.
There are books around but why not just get on a plane and meet some people and check the place out. Good on you for reaching three properties already. You are in the top 2% of all property investors (or is it 5%). That figure still blows my mind. It gets easier from there on. I am holding less than 15 properties for the first time in a very long time but we are getting ready for a big purchase so that is okay.
You can never do enough due dilligence – but that goes for any investment – it can be very worth while but you need to come at it from the right mind set.
The way i see it i was able to keep my oz portfolio intact without using up any equity there. Now many buy holds in NZ and set and paying for themselves after some tweaking and adjustments and the whole machine just chugs along nicely (apart from the odd scary bill or two) On my site there is a quote from dolf de roos who is a property guy that some people have heard off.
I am not big into guru’s and certain ones make me choke but this puts it in perspective in think. That is, regardless of the rise and fall of the market which will happen in the market for anything – fundamentally property investing is easier in New Zealand BUT this does not mean it is easier for an ozzie to make money in NZ from OZ or easier for those that rush in.
The rules of the game may be simply but that does not mean it is easier to win [wink]
Sourcing Positive Cashflow Investment Property http://www.cashflowproperties.co.nz/cashflowproperties_wanganui.htmbaharomParticipant@baharomJoin Date: 2006Post Count: 4
Thanks for taking the time to put such a rich reply together DLPP.
I really appreciate it, and will press ahead, one step at a time!
My best to you, Andrew.Don NicolussiParticipant@donJoin Date: 2005Post Count: 1,086
good luck mate!
Sourcing Positive Cashflow Investment Property http://www.cashflowproperties.co.nz/cashflowproperties_wanganui.htmwestanMember@westanJoin Date: 2002Post Count: 1,950
i lived in NZ for 2 years 2004-05 and buoght for myself 20-25 properties. And for clients about 100 +.
I think Don has summed it up pretty well. If you want to buy in NZ, i’d encourage you to use the resources of Don.
Don and I have heated debates on this forum because i’m negative on NZ and have sold all but one property i own there, but this disagreement doen’t translate to a belief that if buying in NZ then Don will do the right thing by you.
I also think that he is located in one of the better areas (But i haven’t followed whats happening recently apart from the general stats). And thats if Don is still in Invercargill ?
I say one of the better areas as the NZ market as a whole has peaked and now heading south ? ? Invercargill is still cheap and could become the center of some huge Oil reasources.
all the best