“..he finds investments in NZ for yanks (i think) and is an expat Kiwi”

Partially correct. As it appears you [Mini] have been interested in knowing my background, I will provide a general overview.

I am in fact an ex-pat Kiwi who has resided in the United States since 1989. I have been involved in equity-based investment throughout this period,…[Read more]

What are the deposit and default payment terms – in general, and the rent review period?

The Body Corporate Fee [$1800] is about average for this type of development in the Auckland CBD – fees can range between $1000 to $3000 per annum, subject to the number of apartments and on-site amenities.

The weekly projected rent [$400] is also on par for…[Read more]

The following link provides access to information that should answer your questions.

http://www.firb.gov.au/content/default.asp

“make the same amount if you leave it in the bank and whistle a happy tune?”

Real estate offers the potential for capital gains, where money sitting in a bank is confined to capital reduction i.e. inflation, fees and adjustments – and opportunity cost.

If a bank offers ~4.5% per annum, you must then discount inflation i.e. ~2.5% + fees and…[Read more]

“I note with interest that the US economy is picking up and not even the Mad Cow scare has caused it to change course from its current bull run (in fact I read that Americans are now eating more beef!)”

There are many political objectives sustaining the US economy at this time, brought on by the up-coming election. An example being the “Mad Cow”…[Read more]

The deferred option in the United States is a “1031 Tax Deferred Exchange” which is not available in Australia.

Further information as follows:

http://www.irs.gov/businesses/small/industries/article/0,,id=98491,00.html

— Michael

“Do you have anything to do with Conrad properties?”

No.

“Personally I would not touch an inner city apartment”

I would not touch SFH’s – I find there is more money to be made in multi-use/apartment developments.

We all have our preferences.

“I cant see how the lord of the rings effects real estate prices in NZ.”

These movies are introducing…[Read more]

The market data we work with indicates capital gains on this type of development in the Auckland CBD should not be a concern – due partly to demand continuing to exceed supply.

As an example, increased construction costs are resulting in fewer projects, which is having an adverse effect on supply – which works in your favor.

As for Conrad…[Read more]

I have touched on this subject, but in summary the United States housing market is in a similar moderate to downward trend as Australia.

The ROI Robert refers too was more prevalent 12-24 months ago, although like many markets [including Australia but more New Zealand] these deals still exist.

In my opinion, the strengthening AUD is not enough…[Read more]

One of the most valid points in this discussion..

“seasoned investors don’t use average accountants, they use experts”

The same can be said for lawyers and every other advisor involved in the decision making process.

The old adage prevails.. spend money to make money. A simple rule of risk management.

— Michael

“If you have a good bank they will do a letter for you to say finance wasn’t approved, give that to the REA.”

Unless stipulated in the purchase agreement, you do not need to divulge any documents stating why you declined – subject to financing.

Your rights depend on the specific wording. Therefore the document should be prepared/reviewed by a…[Read more]

It is a “1031 Tax Deferred Exchange”.

Further information as follows:

http://www.irs.gov/businesses/small/industries/article/0,,id=98491,00.html

Interesting questions from a 15 year old.

— Michael

The following are very good resources for anyone interested in real estate development. Although published in the US, the fundamentals apply in Australia/New Zealand.

You will likely find these books are less expensive ordering online from this outlet, than if purchased in…[Read more]

Chan$,

There are a couple of reasons I do not attend seminars, primarily the fact that I do not deal in SFH’s.

I specialize in international equity-based investment funds and multi-use development – which has transpired over a number of years.

As noted, I do not disagree with seminars in their entirety, but I do stand by my belief that a…[Read more]

Pisces – I agree with your comments re: seminars, although I will admit I have never attended one – I have however spoken with many who have, and know a couple of the [so-called] “gurus”.

Seminars seem to provide encouragement and direction, and therefore benefit those seeking these attributes.

However, acquiring a substantiated understanding of…[Read more]

No matter what “strategy” people recommend, or how much money/time you have to invest/risk, in order to become successful you have to be passionate about real estate and have a desire to acquire knowledge – whether through books, school, or a mentor. I personally do not recommend seminars.

Once you have gained an understanding of this profession,…[Read more]

The tax deferred option you refer to is a 1031 tax exchange, which I understand is only available in the United States.

Under Section 1031 of the Internal Revenue Code, some or all of the realized gain from the exchange of property may not need to be immediately recognized for tax purposes. Both properties in an exchange must be held for…[Read more]

We specialize in a form of property syndicate [equity-based limited partnerships] which enable our clients to invest in often higher yield/shorter term transactions than they could have independently.

These people generally do not have the time to research an investment in-depth nor are they interested in any ongoing management. They are simply…[Read more]

In my experience, lenders are not interested in a foreign entity structure. There is no security. Therefore, a New Zealand registered entity may be your only option.

In terms of entity type, you should speak with a qualified lawyer and accountant who will advise based on your proposed investment strategy, tax considerations etc.

I understand…[Read more]

RE: “Does this provide the ideal opportunity to invest in overseas property? By taking advantage of cheaper property prices in the US and a higher currency conversion.”

The US real estate market is [in most states] at its peak for now. Comparing the two countries, US real estate is not on average “cheaper” than in Australia.

As you may be aware,…[Read more]