NZ New Zealand? Higher yields? Possible pitfalls?

That's what I thought!. Plus Rumple's figures are from 2013 and since then the percentages would be even closer.

 

Sonny Bill, I would hazard an educuated guess and say there would be more Kiwis renting in Logan than there would be Australians renting in the whole of New Zealand.

 

So you are making an educuated guess.
The irony of you having a go at me about my spelling previously and then not being able to spell educated is not lost on me.

 

If you guys are going to have a petty little argument do it in a private message. His forum is for learning and reading useful information

 

The currency position at the moment is the main thing that would put me off at this stage

 

This thread has peaked my interest in investing in NZ. Although like you, it might be a way in the future. Considering things like currency, etc.

Can anyone explain why the yields appear to be so much higher over there? Vacancy rates higher?

It was the same in the US when I looked a while back. You could find things yielding around 20%. But they don't consider real estate to be much of an investment over there! I'm guessing the yields are higher because the system must be far, far riskier

I was thinking NZ would be much more like AUS in terms of it's property system and level of risk. Although probably a bit riskier. Would love to hear from people who have invested over there though.

 

Yes aus and nz very similar in nature. You get higher yields in the less desirable/cheaper areas and areas that are predominantly student accommodation which all has it's risks. They are in high rental demand which pushes up rental prices. Obviously NZ blue chip areas will have lower yields similar to Aus.

Auckland prices in particular have pushed up of late (50-100% in areas) which in turn provides lower yields so doesn't look as rosy as 3+ years ago.

Lower buy in costs helps with the numbers.

 

Thanks for the info! I also realised the price range of some of the places with high yields were very low - therefore much of this yield would probably be absorbed by holding costs, resulting in a much lower net yield.

 

Instead of making a new post, thought I bring this post back to life.

I visited a nice place called Christchurch and from face value, still a lot of work required to bring the city back to pre-earthquake days, but really exciting to see the level of work rebuilding the city. Can I say the lifestyle is beautiful and recommend anyone to go for a trip there. I had my midlife crisis and had a Mazda mx5 convertible to drive around in my short stay in Chch.

As the others mentioned, currently the currency and the deposit requirement is killing the opportunities but def worth considering for the future.

Sorry @Charlotte30 for not catching up with you and really grateful for all the information and support.

 

Dear All

I am from Christchurch and invest here. I would suggest that those of you looking at NZ as an investment go to the site trademe.co.nz. The property section details houses for sale and rent throughout NZ. This will enable you to work out the yield in any given area. I personally believe we get better rent for the dollar value of property purchased in NZ. In Oz your renovation costs seem to be cheaper than what we pay here. But you have to do your due diligence. I like to buy houses or sites that have an upside. ie renovations with some land to build at the back. That requires a knowledge of the city plan. All of this info is online. For me each purchase has to be cashflow positive. All doable just need to do your due diligence.

Cheers
Charlotte30

 

I've thought about this as my mum has a house with land zoned 3 stories a few blocks from the christchurch cbd but it's valued quite low by the government due to being zoned Linwood (GV counts for a lot in nz and has a huge bearing on market price - unlike in qld where its never considered). It's right on the very border of the 'CBD' suburb. In fact it used to be in the cbd suburb but unluckily got rezoned out about 10 years ago.
She wants to move somewhere smaller in the future but I don't like the idea of it being sold yet due to its position so I was thinking of buying it in the future.

Anyway I always wondered about how to get the rent money back here with the transaction costs of exchange but i guess if you have a nz loan it goes into that? Although not sure what happens when it becomes positively geared?

 

No capital gains on investment properties a big plus

 

Personally feel that there are alot of potential as @Charlotte30 mentioned. Would like to invest in NZ in the future and love the country.

 

Christchurch's population peaked in 2010, but has significantly declined since, most notably families with children.
There's been no data produced since 2013 which doesn't read well.
I'd say extremely high risk.
Come on, a city that has recently had a major earthquake caused by a previously undetected fault line that is adjacent to other fault lines where another major earthquake is predicted within 50 years.

 

@Whitecat the only property I own is L3 and L4 land. Your mothers land in Linwood has increased in value in the last few years.
@Rumplestiltskin There is money to be made anywhere you just have to asses the risks.
There is also a site called propertytalk.com which is NZ based. Well worth a read if you are looking at NZ. There is a poster who goes by the name of "Orion" who invests in regional properties and has very detailed posts on how he does this. Also upfront about his success and failures.

 

Just back from trip to NZ. I would not invest their from Australia at the moment. Major reason is huge currency risk. Also Auckland prices are crazy and personally I can't see the value. Christchurch is too risky for me. Wellington has an earthquake risk factor as well. Any of the other smaller towns and cities always have employment issues, which is a major reason why a large portion of the population is in Auckland. Also I want to clarify that no "capital gains in NZ" does not apply to Australian tax residents completing their Australian tax returns. Capital gains is applied to the NZ property just the same way as it would apply to an Australian property.

 

Auckland has always been dear and always will be. with 59 million dollar suburbs. Always played with the idea of moving there as there are many tax advantages if you have a bit of money.
Seems like a really tough place to live if you have little or no money judging by the number of depressing stories. All my Kiwi friends say don't .
Sunny Bill. What do you mean by currency risk. The strong Kiwi dollar?
So I have been given the wrong information about capital gain on investment properties .by a Kiwi.
On my readings what you say Sunny Bill is correct

 

I know a young Aussie who is a nz resident who has just resigned from a well paying profession as he is making enough money buying homes and converting them to units/apartments and renting them. Does a lot of the hard work himself, but the low entry costs, in particular no stamp duty and good yields made it possible.

 

There are tax advantages and disadvantages living in NZ. While there is no capital gains you are very limited in what you can claim for depreciation. Personal income tax rates and GST are higher in NZ. By currency risk I mean $NZ is strong at the moment but I personally feel will start to move back to status quo around $1.20 per A$.

 

First time poster. We just settled two properties in Melbourne last Dec. Came to Auckland for a visit and we have an unplanned offer conditionally accepted in blue chip suburb in Auckland. I believe the Auckland market has a small blip due to some minor restriction on foreign investment before it picks up again in a few months time. It would probably been sold 10-20% higher prior to govt changes in foreign investor.