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Thanks for all the great info so far! More questions if I dare! What do the lenders think of this kind of project – back home some are a little wary of lending on the potential gains, which are achieved through renovations. In the past I have used mortgage overdraft accounts to secure the cash for the purchase of building materials etc, would this be an option here? Or are there better alternatives?
Has anyone thought of “teaming up” with other investors in the same locality to obtain better deals?
Man alive, so many questions, so little time, so many great projects!
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The beaches sound great! I read that the population of nearby places like Lakes Entrance swell massively in season, do Australians (still trying to figure you lot out! [biggrin]) use / rent holiday homes? Quite a popular kiwi thing, and makes owning a holiday home / bach more of an investment.
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Great site, thanks!
Zena
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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
Now is the time to buy at the moment, especially in the south, Christchurch, or smaller towns like Gore. Sounds like a daft thing to say, but make sure you know the area, or at least have a look on a map before buying. I’ve met far too many people in the last week since moving over here that are scratching their heads as to why they have un-tenanted IPs in NZ. Then you find out that some rather shifty real estate agent has sold them an expensive place, 200km from the nearest community. (why why why!) Also, consider setting up a loss attributing qualifying company to help out in the taxation department.
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Okay, heres a curly one. As I’m now an Australian resident, (but still a kiwi citizen) and obviously paying tax in both countries (that really does sound like a bit of a rip off!) how will it work if – my NZ properties are owned by a Loss Attributing Qualifying Company, (do these companies peform the same way here in Aust?) which in turn is owned by my family trust – all set up to minimise tax payouts against my personal income. If I use this tax vehicle in NZ, can I use a similar one here? And, <deep breath!> if I have minimised, or through the LAQC, turned the properties into a loss, can I claim that against my income here? I’ll sit down and work it out, but this method may help those investing in NZ from here.
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