“the question is faulty”.. “you don’t have to have growth or cash flow, you can have both”

— The question assumes property will not generate capital growth over the desired holding period.

It is true that all property will appreciate in value over time, but there are locations where this cycle stagnates or is reversed for a period of time,…[Read more]

“I do not believe there is such a thing as no capital growth potential. The world has an increasing population.”

— Agree. Time dictates capital growth – the key is selecting a location which clearly demonstrates growth during your desired holding period.

“the NZ government has deliberately slowed immigration to cut down the number of people…[Read more]

I have never liked the term “crash” – because it exacerbates what is simply a market “adjustment”.

Having read the responses to this post there are two points I wanted to touch on.

1. A savvy investor will only buy a property once “potential market adjustments” have been taken into account.

Historic data should be used to determine worst case…[Read more]

In response to the following:

“have a large amount of money and are willing to travel and set up corporations”

No more money is necessarily needed to invest in the US or Canada than is required in Australia or New Zealand, the question is how do you leverage the investment if required, i.e. institutional funds, and obtain legal rights to acquire…[Read more]

My investment strategy is simple, capital growth comes first and foremost – otherwise I walk away.

In simplistic terms the reason why properties demonstrate capital growth, and others “at a much lower price” with no capital growth potential do not, is supply and demand.

[a] suggests there is demand for the property/location, which is likely to…[Read more]

“I think there are many people who have no idea what they’d do with $30M”

Turn it into a billion dollars.

— Michael

This post [discussion] is getting off track. It does not appear anyone has an issue with Marc’s signature, rather the content of his replies, and I might, overall arrogance.

I found this comment quite amusing..

[Marc] “I rather share some knowledge that may be useful to you in your next bargaining situation”

What “knowledge” or even…[Read more]

Reverting back to the original post – an interesting scenario and debate.

Personally I am not the type to let emotion stand in the way of any business decision. But in saying this, I have learned over the years that there are certain deals you walk away from for moral or other reasons.

I would walk on this deal if I felt the family would benefit…[Read more]

This is the most valid point..

“Once you imagine something and then start living it in your mind then you will be able to find ways of achieving it.”

— Michael

The markets I have highlighted offer a lot of potential in terms of capital gains. But in saying this, you may have found comparable [or better] opportunities in Hamilton.

The New Zealand market is in an interesting cycle due predominantly to foreign interest and investment – and it is considered a safe haven. The market will plateau for a short…[Read more]

As you may know, New Zealand real estate prices have appreciated across the board in the past couple of years.

The best location depends on your entry point – as in how much capital you want to invest.

If you are seeking to buy a low to moderate cost SFH [single family home] – positive or negative geared, Dunedin in the South Island is a solid…[Read more]

“the difference in repayments between a commercial loan and residential loan are quite significant and may tie the persons finances up too much, particularly if on a low income.”

The premise of my post is to bring on board experienced advisors – preferably with a successful track record in real estate investment.

The size of the project is…[Read more]

You asked an interesting question which I wanted to revert back too.

“Question is is it better crawl before I learn to walk ? or is it ok to run if you see something that would work?”

Most people will tell you it is better to crawl before you walk – however, many I have come across who abide by this sentiment are not what you would call the most…[Read more]

Any prominant real estate investor will tell you land or any other real estate holding is defined as an “asset” – not a liability, even if the debt to income ratio is weighted toward debt.

Forget how the Rich Dad book defines assets and liabilities – such statements do not do much for ones credibility as an investor.

The following statement sums…[Read more]

As a general rule – and based on the information you have provided, retain the land and borrow against the equity.

This recommendation assumes the land is not a financial burden and is in a suitable location from a lenders perspective.

— Michael

“I’m assuming the original contract was unconditional, so no matter what the funds will have to be ready at settlement anyway.”

My point was, it would “appear” [Stevie24] is not in a financial position to risk having access to another buyers deposit prior to settlement – or why the need to “free up” the deposit.

As noted, the scenario I outlined…[Read more]

I don’t personally know of an institutional lender that would not lend on equity in Australia for investment in New Zealand – if the numbers stack up.

If the loan is secured in Australia and you default, the asset in Australia is foreclosed or otherwise. The loan is not necessarily impacted by the New Zealand investment in this regard.

However,…[Read more]

In a transaction such as this, you should not seek to claim the deposit from the person you sell too – unless you have access to sufficient funds if the person defaults.

Even with a clause that states you retain the deposit on default.

The result would then be owing the original seller the balance at settlement, and potentially repaying the…[Read more]

As noted, the land can be sold prior to settlement. We conduct these type of transactions on a regular basis with land and buildings.

The transaction should be conducted whereby the purchaser submits a deposit i.e. 20 percent – which is then held by your lawyer in a trust/escrow account until settlement.

The balance is paid to you on the…[Read more]

“gross ROI” and “net ROI” are not terms typically used, but in the books context they likely represent the “pre-tax” and “after tax” return on investment – I am not familiar with the book.

Terms commonly used to define “pre-tax” income include “gross margin” or “gross profit margin”.

“After tax” is defined as “net income” or “net…[Read more]