Forum Replies Created
Surfermark, that sounds a good book. I will look into getting it.
Regarding LAQCs, I was told they are no good for non-residents of NZ?
Shar
Woops, half way through a reply and it disappeared? Will start again.
I don’t have a problem paying tax in Oz on monies received from NZ. I would expect this to be included in my normal tax return as foreign income. However, what I’m trying to avoid is having to lodge a separate return here in OZ for the trust and then having to pay my accountant an extra fee for having to do this over and above the fees for lodging our personal tax returns.
On a separate issue, some topics have mentioned the fact that you get charged CGT in Oz on sale profits from NZ, when speaking to the ATO they say if we receive profits here from the sale of a property in NZ, it would be CGT on our returns, however, it would be taxed at the same rate as any rental income we received would be taxed at ie whatever our income rate is, so personally I don’t see that as a problem.
If the builder is renting it back, make sure their business is OK as if they go broke, the lease back isn’t worth anything!
Yes Terry, the solicitor is a trustee along with myself and my husband. He seems fine with that. He also has our Power of Attorney for signing documents dealing with property as we are out of the country. I can’t see it being a problem for him though as the properties more than cover the loans. The appointor is myself and my husband combined.
I have mentioned to the solicitor that I thought that if we are appointor, trustee and beneficiary it may not be a bona fide trust. Am awaiting a reply from them.
We haven’t signed the trust deeds yet as want to make sure its right first. Unfortunately we have a purchase which is settling 4 Mar which I was hoping to be purchased by the Trust but it might have to be purchased in our own names as our other properties were. However, better to get the Trust structure right first.
Shar
Thanks for your help guys.
I might put this question into the Help section to see if I can get some more answers.
Hi Trish
I am also keen on Christchurch and would love the same info as Sharon has asked.
Shar
For NZ I use realenz.co.nz
Shar
Hi Redhaven
I do bookkeeping for some developers – if you PM me I can put you in touch with them if you are in the right area.
I don’t know alot about the developing side but have learned enough to know it is a helluva lot of work and you need a lot of expertise to try and do it yourself!
Shary
Is the house in a display village? How secure is the builder as a tenant? If the house is in a display village and the builder goes broke, I believe you can’t lease it to a residential tenant until the village life comes to an end (they have a limited life – Council can tell you what it is).
These can be a good buy if the builder needs the money but still wants the display home, however just check out the above.
Shar
Hi Pgrim
I am an Australian resident with 1 IP in NZ and currently purchasing a 2nd one.
Can’t help you with the tax rate but you could check out http://www.ird.govt.nz. The Inland Revenue Department is the NZ equivalent of the tax dept here.
Yes you will need to put in a tax return in NZ so will be best to use an accountant there to do it for you. You will then have to declare the NZ income and NZ tax paid on your Australian tax return.
There are lots of items on this forum regarding investing in NZ.
Shar
Hi Jan-Marie
I can relate very well to your problem as also have a granny flat we rent out. And yes, the smoke does seem to filter upstairs! We have always advertised as “non-smoker” although local newspapers insist on putting “non-smoker preferred”. We have had many tenants over the years and one or two who said they were non-smokers turned out otherwise.
Out of all the tenants we have had, I would have to say the young lads have been the best. We have had solo mothers with small children – nice but always there and constantly doing laundry. Young girls – once again nice but somewhat demanding. The several young lads have all been excellent. Maybe not as clean and tidy as you would like, but it is not difficult to give the flat a good spring clean when they have moved on.
We did end up with one tenant who was a nightmare! I wont go into everything but just lets say she was mentally unstable! I did phone her references before she moved in but didn’t ask enough questions!
The best advice I can give is to stay on side and as pleasant as possible to your tenant until you can get him out. Maybe suggest to him in a nice way that it is not working out but you will be happy for him to stay until he can find something else. The reason for this is that it can be a nightmare to get him out through official channels and in that time if he stops paying rent you can be out of pocket for quite alot and he can also do alot of damage and cause alot of grief to you which the bond may not cover.
Good luck (and be sure to check the references very carefully next time)!
Shar
http://www.stats.govt.nz
is also good for maps and statistics on an area.Sharyn
Baulkham Hills
(north west Sydney)Hi Lazyboy
I’m originally from New Plymouth many years ago – actually grew up in Inglewood. How are property prices in Inglewood these days? Any good for investing? Lovely little town and such a short commute to New Plymouth.
Shar
Hi Marissa
I see you have had lots of great replies to your problem and hopefully have done something by now.
However, one question I would like to ask before you rush into getting rid of the tenant, “is the rent he is paying a good rent in the current market and are there lots of properties like yours looking for tenants at the moment?” If this is the case, maybe not the best idea to ditch this tenant if he eventually always pays up – you could be left with a vacant property or end up having to lower the rent to get someone in.
I would certainly change agents though, and let the new agent know that the tenant must be up to date at all times and action taken as soon as he is late otherwise you won’t be keeping them as an agent!
Shar
Having worked in Real Estate and in particular in Property Management, I can tell you there are some great PMs out there, but there are also some extremely bad ones too.
Unfortunately the commissions are low so alot of agents go for volume to make their money but then are not able to service the properties & tenants as well as you would hope as an owner.
If you can find a company that specialises in PM only that is your best bet. Whoever you use though, keep a really good eye on them to see that they deliver what they promise, that the paperwork ie leases, inspection reports etc are all in order!
It’s also a good idea to have some way of the tenant contacting you if they are having problems with the PM. This can be difficult as you don’t want them hassling you and you want to keep your distance. However, maybe giving them an email address or something might suffice. Otherwise you don’t know problems are occuring until you lose a good tenant. It is also a good way of getting feedback on how well your PM is performing.
Shar
Hi Ziz
The reason I mentioned NSW is that I live and work here and evidentally want to buy IPs here.
I originally thought I ought to have the right structure set up here, however, after reading all above, I realise I can probably forget about anything here and just look at whether I need to set up a trust structure in NZ whilst buying IPs there.
There is so much to learn in this business!
Shar
Hi Pete
I too am looking for an accountant in Sydney with this knowledge. I will put a new topic on the Forum to ask the question.
Good luck in NZ. You will find it abit of a culture shock moving from Sydney but just enjoy the slow pace and you will learn to love it!
Shar
Thanks Guys
I will keep investigating. I definitely want to buy more than one property and so want to get things right to begin with.
Does anyone know a “property savvy” accountant in Sydney? (I’m in the North West of Sydney). I don’t think my accountant would be much help!!
Re the land tax threshold, I thought the new laws in NSW mean you pay land tax on all IPs now regardless of cost and regardless whether held individually or in a Trust? Or have I misunderstood it?
Shar
Great story! However, after working in property management for alittle while now, I am not at all surprised. The incompetency in some PM departments is unbelievable and quite scarey.
Agencies don’t earn much on PM commissions and therefore alot just concentrate on volume to make money and frankly it can be very difficult to maintain a very large rent roll if there are problems and if the agency doesn’t have very good, streamlined systems in place.
I would suggest everyone keep a very good eye on their statements – query everything. Make sure your tenants don’t fall behind as by the time some PM’s bother to chase them up, it can be too late. Also diarise when you think inspections are due and chaseup the agency if they are late.
Re the arrears – I like the idea of giving tenants a rebate if they keep their rent in advance – this way it is much more likely they won’t fall behind.
Insist on getting a copy of all new leases – and check them for accuracy. Also a copy of the condition report whenever a new tenant goes in.
There are some good PMs out there but I’m not sure how to tell who they are to start with. Although after afew months you will soon be able to tell and if they are good, you can relax a little and rely on them.
Ciao
SharI am also going down this path. I believe from the ANZ Bank that you also need a solicitor in NZ to handle the paperwork.
Does anyone know of a good solicitor in NZ? Preferably around Wellington?
Shar
