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Thanks for the advice and cautions. We will only proceed if and when all due diligence has been done and I suspect that will mean that we hang back for a while. Putting some time in between an emotional decision and hard reality often reveals the folly of the former!
Why is this so? Other major cities in the world regard inner city locations in a very favourqable light. How is it that in Sydney, Pyrmont and the CBD are considered bad risks for banks?
Thanks for the reply, Nobleone. Since you seem to have had your NZ investments for awhile, what would be your advice in today’s market – are you still investing there? You say you have a trust and get finance from NZ, is the tax situation in Aust negating any profits you make in NZ by bringing the profits back to OZ? I am asking lots of tax questions because this is the crucial factor for us, we pay large income tax and need tax minimisation in order to crunch the numbers in favour of investing offshore. As I understand it, having a trust won’t help us to reduce PAYE tax.We have considered living in NZ for 6 months- this might be a lifestyle and profit solution. Steve’s equation: problem + solution = profit. Any suggestions? Selling the PPOR is our first step in OZ.
Hi
We have just returned from a property fact finding trip to Queenstown , New Zealand. We arrived home tonight so this info is current. There is no doubt that real estate investing is easy and relatively tax free in NZ compared to Aust. BUT there are some problems associated with cross Tasman investing:
1. The NZ interest rate went up to about 7.7% while we were there.
2. If you borrow money in NZ you can’t take the tax losses (depreciation etc) across to Aust, so no tax benefits there for individuals (not sure about implications for companies and trusts)
3. The rent returns were not great in Queenstown – about 4% and house prices were high.
4. Property managers charge 10% – difficult to manage your own properties from a distance so you need to factor this in.
We left there a little disappointed but we had a great time doing the knowledge. Queenstown is a beautiful place and the views are spectacular. We haven’t given up the idea just need to rethink the strategies. The real estate folks, accountants, bank people and solicitors we met were very helpful and made everything very simple.
cheers
SallaThanks Terry, helpful advice. I have just read Steve’s book “0 to 130 properties….” couldn’t put it down! It is just what I need in terms of preparing an income after retirement. The only trouble is, positive cash flow is so hard to come buy (as has been mentioned many times on theis forum). The strategy to rent the present PPR and downsize has some positive lifestyle benefits. I have just mowed our large lawn, exhaustion! Looking forward to a smaller dwelling with no gardening. Would still value some other comments about renting out the family home (the kids are against selling it).
cheers
