Innholdsfortegnelse for Jan 2017 i NZ Property Investor

 Welcome to a new year with NZ Property Investor. I hope you’ve all had the chance to put your feet up over the festive season and are ready to get stuck in this year, should that mean the first step onto the investment property ladder, or the expansion of an already established portfolio. IF THE NUMBERS WORK THEN THERE’S NO REASON TO BE PUT OFF, WHATEVER THE MARKET CONDITIONS This month you’ll get market insights in our 2017 forecast feature (p24). In writing this piece, I spoke to many investors and industry experts on their predictions for the market outlook in 2017. As you can imagine, it was an interesting exercise; while one expert would say the economy is looking stable, another would insist we are heading into a recession.…

THERE IS A WINDOW OF OPPORTUNITY TO REFINANCE BEFORE ALL THE BANKS HIKE RATES – PETER NORRIS IT’S PRETTY CLEAR TO SEE the state of the nation has changed quite suddenly in recent months. RBNZ restrictions have had the desired impact with roughly a 20% slowdown in the Auckland market. Whether this will continue is yet to be seen, but early 2017 will certainly be interesting. My thoughts are that this is simply a case of extravagant and over-the-top vendor expectations being kept in check by buyers who are now unwilling to pay more than a property is worth… and why should they? The heat has gone out of the Asian market as a result of the overseas income policy changes from within the banks. This is not a dissimilar…

KRIS PEDERSEN Kris Pedersen of Kris Pedersen Mortgages is a commentator on property and finance. His team sources top finance strategies. Phone 09 486 4719, www.krispedersenmortgages.co.nz MARK WITHERS Mark and his team specialise in advising on property-related transactions, valuation and restructure services, and tax planning. Withers Tsang & Co Phone 09 376 8860, www.wt.co.nz RON HOY FONG As a successful property investor and mentor, Ron has built an impressive portfolio and a wealth of investment strategies and experience. Contact Ron today on 021 888 298 or ronhoyfong@gmail.com BERNARD PARKER Bernard is principal of Quinovic – Kapiti-Mana. Quinovic’s outstanding people and systems provide the most professional, effective and reliable residential property management service in the NZ market for over 26 years.www.quinovic.co.nz MYLES NOBLE Myles is head of claims and earthquake response…

IT'S FRUSTRATING TO HEAR, YET AGAIN, THAT TAX LOOPHOLES SUPPOSEDLY FAVOUR THE PROPERTY SECTOR WHEN IN FACT THE OPPOSITE IS TRUE – MARK WITHERS IT’S LONG ON RHETORIC bemoaning tax loopholes that benefit those with wealth, but the Opportunities Party’s tax policy seems to again target a solution for this at the feet of the property sector, claiming somehow that imposing a tax based on a deemed rate of return - that bears no basis in economic reality - would somehow persuade people to invest in the share market and that this form of investment is somehow better for our greater good. It’s frustrating to hear, yet again, that tax loopholes supposedly favour the property sector when in fact the opposite is true. Let’s just examine again how this pendulum…

I DON’T BELIEVE IN FIRST HOME BUYERS; I THINK IT’S A TERRIBLE TERM THAT HAS CAUSED HOUSING INFLATION IN ITSELF - CAMPBELL VENNING WE CONTINUE TO HEAR THAT New Zealand is under-supplied in property and over-supplied with buyers. At the same time the Reserve Bank is terrified of the price increases that keep occurring in Auckland, Hamilton and Tauranga to the point they keep pulling lever after lever to slow these markets down as they represent the majority of the New Zealand property market by price and volume. Yet, with New Zealand increasing at a run rate of 70,000 people a year, the first home buyer continues to miss out on getting into the property market. I don’t believe in first home buyers; I think it’s a terrible term that…

NORTHLAND NEXT MEETING: February 2017, at Distinction Whangarei, 7 Riverside Drive, Whangarei. MEMBERSHIP: $180 single or $210 couple; includes subscription to the NZ Property Investor and NZPIF discount card, plus local trade discounts. Please email npiacontact@gmail.com for more information.PO Box 1640, Whangarei. AUCKLAND NEXT MEETING: APIA hosts 100+ informative property events throughout the year to further members’ knowledge of the market and confidence in investing. For upcoming events please go to www.apia.org.nz/events. MEMBERSHIP: Sign up for an APIA membership at www.apia.org.nzjoin. APIA memberships include a free subscription to the NZ Property Investor, networking opportunities at over 100 events throughout the year, an excellent discount card, free subscription to APIA TV, and massive savings off mortgage interest rates with the ANZ bank. For more information visit www.apia.org.nz or email admin@apia.org.nz. WAIKATO…

1 Auckland’s Hot Spot Suburbs Auckland first home buyers are active in the market with six ‘hot spot’ suburbs emerging where they are paying on average between $641,000 - $708,000 for standalone homes. CoreLogic data shows that first home buyers have made up more than 21% of the Auckland market this year, up slightly on 2015. New builds require less deposit and are emerging as an option with first home buyers, up more than 2% this year on 2015, with Flatbush, Takanini and Silverdale popular locations. Meanwhile, the appetite for apartments has flatlined with fewer than 12% choosing that option. 2 Decline in Sales Nationwide Residential property sales have dropped nationwide and yet median prices have set new records in several regions, the latest REINZ data shows. Auckland’s median price…

BEN MITCHELL Actor Ben Mitchell was stunned by the flood of positive responses to his profile in Property Investor last year: “I had so many people say, ‘You didn’t tell me you were doing this’ and I’d reply, ‘You didn’t ask. ’ I said that so many times! And people asked, ‘How did you get started?’ People seem to think property investment is for someone else, someone with a degree from Harvard,” he jokes, “when really it’s common sense.” As well as questions and commendations, he received plenty of speaking requests – but the only one he’s accepted is the NZ Property Investors’ Conference in October. Since the profile story he’s been busy working on Shortland Street, working towards producing his own film and featuring in the remake of Goodbye…

YOUR ENGINEER SHOULD BE ABLE TO GUIDE YOU IN CHOOSING THE APPROPRIATE MAXIMUM STRENGTH THAT CAN BE ACHIEVED FOR YOUR BUDGET - PAUL CAMPBELL WHEN THE DEVASTATING CHRISTCHURCH earthquakes hit back in 2010/2011, they took most people by surprise. To a degree, the level of damage reflected the lack of anticipation and preparation. In the six years since, seismic activity seems to have stepped it up a notch. There have been significant earthquakes in Seddon and, more recently, Kaikoura. As a result, awareness of the risks to people, property and businesses has increased, while much work has gone into strengthening buildings. But as the immediate impression of each earthquake fades, so too does the level of preparedness. How many commercial property investors know how to earthquake proof their property –…

THAT’S WHAT 2017 IS ALL ABOUT, GETTING THE RIGHT DEALS, IN THE RIGHT PLACE, WITH THE RIGHT STRATEGY – SUE IRONS WE SAW A SIGNIFICANT shift in the property market in 2016. For the next five to potentially 10 years a new approach is needed to keep a property investment portfolio constantly growing. Invest the ‘old way’ and you will get stuck and not grow. When you stagnate like that, you are signing up to work for an additional five to 10 years longer than you were probably hoping to. Investors who embrace the changes won’t fall for the same trap. They won’t have to sit around for an additional decade waiting for the market to give them the growth they need to advance. That’s why education and a newly…

IN MY MIND CAPITAL GROWTH IS THE MOST IMPORTANT FACTOR OF ALL - MICHAEL YARDNEY WE LIKE TO THINK WE’RE RATIONAL human beings. However, we are in fact prone to a group of cognitive biases that cause us to think and act irrationally, and this affects many of our investment decisions. Even thinking we’re rational despite evidence of irrationality in others is known as blind spot bias. Not all properties make good investments! Of course, any property can become an investment property. Just move the owner out, put in a tenant and it’s an investment, but that doesn't make it ‘investment grade’. The things I look for in any investment (including property) are: • strong, stable rates of capital appreciation; • steady cash flow; • liquidity - the ability to…

THE DATA Rental data is sourced from the Ministry of Building Innovation and Employment (formerly the Department of Building and Housing) based on rental bonds lodged. This rental data is supplied to us grouped into geographic areas based on statistical area units used by Statistics NZ for the census and as a result do not always match well with common usage suburb names. The rental data for each area is matched to house price information from our database to determine property prices and therefore yield. The yield is calculated as the annualised rental income divided by the median house value calculated using our E-Valuer. MARKET COMPOSITION Due to the relatively sparsely populated holiday areas, MBIE group the data into wider geographic regions. For this review we’ve included Bay of Islands,…

RENTAL RETURNS NOVEMBER 2016 NATIONAL RENTAL PRICE MOVEMENT This map represents change in the average rental price between the months of November 2015 and November 2016, based on figures from the Ministry of Business, Innovation & Employment. EXPLANATION OF STATISTICAL TERMS No. of Properties: Total number of residential properties No of Bonds: Total number of bonds lodged in last three months Median Rent: Weekly rent based on the bonds lodged in the latest three months Rent Quartile Range: Inter-quartile range of weekly rent based on the bonds lodged in the latest three months Median value: The median value of properties in the group based on estimating the current market value of each property using our E-Valuer at the end of the latest month Gross Yield: Annualised median rent as a…

#1 THE NEW ZEALAND PROPERTY GUIDE The New Zealand Property Guide by Lisa Dudson is a great resource for both those considering property for the first time and those that have been investing for a while. There are many things that help an investor increase their chances of success and this practical hype-free book is full of information that will help you understand: • Why property is such a great investment • How property makes money for you • The mindset you need to be successful • How to set clear goals • The various property strategies and how they each may work for you • The ins and outs of tax and structures • The risks involved and how to mitigate them…

TWO “ORDINARY KIWI GUYS” WHO BECAME MULTIMILLIONAIRE PROPERTY INVESTORS SHARE THEIR SECRETS KRITZO VENTER IS A YOUNG civil engineer in Wanganui. While he enjoys his job, he also realises working for wages will never create long-term financial security for his family. Kritzo started dabbling in property investment about two years ago but lost money on poor deals. He realised he needed to educate himself seriously if he was going to achieve his dream of becoming a successful property investor. While searching online, Kritzo found The Property Investor Centre’s e-coaching mentoring course run by successful kiwi property investors Clint Taylor and Shane Allen. “I was excited when I saw what Clint and Shane had achieved and the testimonials from some of their students,” he says. “They seemed to be just ordinary…

If people are buying or planning to buy, we are keen to know which regions you are buying in and why? COMMENTS ▶ Wellington (Hutt Valley) still good value, sizable city, diverse work opportunities, reasonable infrastructure in place and new projects underway, population increasing. Yields are ok too. ▶ Dunedin, because that's where I have houses already or Blenheim because that's where I'll be living/working. But I don't think I'll have enough equity to do either option. ▶ Greymouth, West Coast. Shortage of rentals and cheap. We are curious to hear about people's investing plans for 2017 and what do you think will be the biggest challenges to investing? COMMENTS ▶ Whilst I would like to purchase more property in 2017, at this stage it is likely we will look…

IF BUYING AN APARTMENT THIS YEAR FITS INTO YOUR FINANCIAL STRATEGY, DON’T BE PUT OFF BY A FLAT MARKET – JUMPING INTO A HECTIC MARKET ISN’T THE SMART WAY TO INVEST – AARON TUNSTALL - AARON TUNSTALL FORECASTS ARE ALWAYS DANGEROUS, especially when events are proving startlingly unpredictable – Brexit, Trump, earthquakes – and cast long shadows on the economy. In one tiny segment of one small market, however, I am going to go out on a limb and make a few forecasts for the year. The middle of 2016 saw prices for Auckland apartments drop slightly, then plateau toward the end of the year. This has been caused by a combination of factors that have led to a feeling of caution among buyers. One important factor has been a…

SOME INVESTORS ARE SCARED OF LOSING THEIR TENANTS WITH A PRICE INCREASE – SARAH DAWSON OWNING AN INVESTMENT PROPERTY is a hugely exciting opportunity and if managed correctly, can provide you with a high-value asset. I have compiled together some insights and strategies which can help ensure your investment maximises its potential. As with any long-term goal, having a strategic approach to investing and managing the investment will put you in good stead for property success. To maximise property growth and rental return in your investment, how can you manage a premium investment property? Good tenants This may sound like common sense, but having respectful tenants will make your life a lot easier, not to mention it will decrease the risk of damage to your property. Having good tenants will…

DESPITE THE FACT THAT THE NUMBER OF PROPERTIES BOUGHT AS RENTALS HASN'T VARIED MUCH FOR MANY YEARS, THE GENERAL PUBLIC BELIEVE THAT WE HAVE BEEN OUT ON A SPENDING SPREE - ANDREW KING I HOPE THIS MAGAZINE FINDS YOU still on holiday and enjoying a well-earned break. This is a great time of the year to contemplate events of the past year and where you are heading in the coming year. Quite a few aspects of property have not performed or acted as they previously would have. House prices went up but interest rates went down. Tenants moved in with each other, increasing the number of people living in individual rental properties, but rents still rose. A property investor was elected as US President and our industry wasn't blamed for…

Accessible Properties 022 043 5995 www.accessibleproperties.co.nz B&N Property Management 0800 111 252 www.bnproperties.co.nz Bayleys Real Estate 0800 BAYLEYS www.bayleys.co.nz/commercial Black Label Mortgages 027 418 1688 www.blacklabelmortgages.co.nz Click Property Management 0800 1 CLICK www.click4rent.co.nz Connect Realty 0800 333 221 www.connectrealty.co.nz CoreLogic 0800 355 355 www.corelogic.co.nz Crombie Lockwood Insurance 0800 276 6243 www.crombielockwood.co.nz D&D Financial Consultants 09 369 5144 www.dandd.co.nz Diamond Ideas Ltd 0800 164 461 www.healthandsafetycompliance.co.nz Discount Property 021 280 6655 www.discountproperty.net.nz EnviroCheck 0800 378 483 www.envirocheck.co.nz First Mortgage Trust 0800 321 113 www.firstmortgagetrust.co.nz Fresh Tax 0800 18 18 19 www.freshtax.co.nz G.J. Gardner Homes 0800 424 546 www.gjgardner.co.nz iFindProperty 021 486 000 www.ifindproperty.co.nz Impression Real Estate Ltd 09 300 5001 www.impression.co.nz Just Cabins 0800 58 78 22 www.justcabins.co.nz Keith Hay Homes 0800 KEITH HAY www.keithhayhomes.co.nz Key Exchange Property Group www.keyexchangepropertygroup.com Kris…