I’m surprised that New Plymouth/Taranaki isn’t an area that’s been discussed as a good place to buy. The region has a lot going for it: The beaches, surf, mountain, skiing etc and the economy is booming (see: http://stuff.co.nz/stuff/dailynews/0,2106,3192007a6002,00.html). The oil and gas industry is also growing, so shouldn’t this all equal a good place to invest?? Better than Tokoroa I would have thought??
Hi Robot
i agree 100% its a great area. But towns like Hawera have had some great capital growth over 2004, maybe it will continue. Sadly we can’t buy for our clients there as the prices have risen so much that the returns have dropped.
regards westan
I live in New Zealand, for a fee find cash positive deals there, and now 15-25% Returns in the USA email me at [email protected] to join our database
Hi Robot
I’m originally from Taranaki and when I was over there late last year I looked around New Plymouth but the prices had risen too much for a decent rent return. I had thought I might get something in Inglewood as I remember property being pretty cheap there but the prices had already risen too much.
Sadly I looked at Hawera but there was nothing worthwhile the day I was there so I didn’t pursue it. Now prices have taken off there – if only I had looked abit harder then!!
Shar
Oh I see that’s a shame I really wanted to get a property in New Plymouth. Are you sure its no good? My friend recently brought there and was pretty happy with his purchase.
So which areas are offering the best returns at the moment?
Can anyone give me some pointers, I’m originally from N.Z but have been abroad for a long time (currently Tokyo) and I really want to get a N.Z IP because right now I don’t own property. But is it a good time to buy my first IP?? Is Olly Newlands property crash really coming? All I want is something that pays for itself so I can start building equity, I need equity! Ideally it would be good if I could get something that’s easily tenantable now but has good renovation potential so in a couple of years I could clean it up quickly then sell and reinvest. Don’t really want to put in anymore than 15k all up right now because the NZ$ is so high.
What would be a good strategy for me? Any advice you could offer would be appreciated.
Hi Robot
Ollie Newlands book was written 12 months ago and people are still waiting for the bust. How long do people have to wait?
However interest rates are expected to go up again and the housing situation will slow down a bit I think.
Property in New Plymouth has had big capital gains and gross yields have dropped thus making it uneconomic for property investors.
Have you visited http://www.propertytalk.co.nz which has become NZs biggest property forum and asked your questions there?
Regards
It all comes down to yields, as westan said.
Yes, Hawera, Marton, Waverly, were fantastic places to buy, and I bought a fantastic rental property in Waverley on a 24 percent yield 18 months ago (just for cashflow, not expecting it to go up in value – so the rest of the world told me -) and just sold it on a 9.9 yield – todays’s ‘still a great deal’.This doesn’t mean I am not keen on the area or I had any probs with the tenant, on the contrary, I had a great long term family tenant who works at the local school. It’s just that if I could make, er, what is it…8 years of cashflow in two, you have to weigh that up versus just keeping it for rental income. 106 percent capital gains is just not gonna happen every year in the same area. So I am moving my investments to areas where I can buy on a higher yield, where I am expecting capital growth. The same sorts of areas that people may say ‘you are nuts buying there’. Ironically, once it catches on, and if I am right, then it will be sorta too late, again! meanwhile, if I am wrong, the cashflow makes it a painless speculation!
if I can cash up and again use the money to reinvest in something that is again going to zoom, this is the way I intend to again triple my equity within the next few years too. Also using ‘improving the property/rent’ as a strategy.
I would rather buy in other better quality areas for a 10 percent yield or more *now* than a place like Waverley at 10. Or Hawera at 9. Even though Hawera is cute town. So yeah, all those places in South Taranaki, used to be the cheapest area in NZ, undervalued, so what happened? well, New Plymouth is going through a renaissance as is wanganui…there is natural gas, mega employment prospects, and so on. So, if you buy at 9 percent today in Hawera, who knows, you may still get capital gains. Rents may also go up. Then again…i wouldn’t bet my fortune on it, certainly not over other areas in nZ. Now we can’t buy in the past, we can only buy NOW. Although there is nothing wrong with the area, it’s great! – I am still constantly looking in the South Taranaki area – I just feel that everything is extremely overpriced at the moment for what you can get in more quality towns and cities in NZ.
The market changes, and yesterdays’ place to buy is yesterdays’. Today’s places to buy where I am looking in and actively buying in, are either ‘the next South Taranaki with the same market conditions as were found there 2 years ago’ and, strangely (or not!), an area that 2 years ago I wouldn’t have touched, way overpriced, but now is looking extremely attractive.
You just gotta not get hung up on one area as whenever the ‘buzz’ catches on, you are maybe too late.
cheers-
MiniThanks for the sound advice, much appreciated. I think there maybe still some small capital gains possible in Taranaki as tourism seems to have a future.
MiniMogul I’m sure I’m pushing my luck but any tips on where I should be looking??? Todays places??
Can’t name check towns as we are already out there making offers on every likely contender as it is! Good luck!
cheers-
MiniHi Robot.
Looks like you have got some good tips.At the end of the day, if you know that long term the Taranaki region is an odds on bet, and you pick up something that isnt going to cost you cashflow – then I say one IP is better than none.Dont fall into the trap of having to get the best deal at the expense of not acting on getting a good one.
I am negotiating one right now and it is returning 10% yeild and in monetary terms ….. $34K per annum Nett (approx)
+ it is in a great high density population area In the North Island.
They are out there in abundance…. you just need to seek and find solutions to problems.
Cheers,
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Good for you KiwiFulla. Yes I would say that there are still, well not plenty, but enough higher priced multi-unit CF+ve properties over in NZ. Like once you get over say 300k you have a lot less compeition. what is thin on the ground is the bottom price-range.
Hi Robot,
As the others have mentioned that region is a beautiful part of the world. Currently, there are alot of planned investments in relation to offshore gas and oil. The region is already seeing the positive effects of this during the early stages.
.
Have you spent alot of time around the region?
.
Good LuckHey Mini Mogul…. price on this one os over $1,000,000 … .and yo uare correct …. offers are like tumbleweed rolling in.
Cheers,
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Kiwifulla,
damn! we are so on the same page…
cheers-
miniHi Don and Liz
Yes I’ve spent quite a lot of time in New Plymouth. Looks like the area will keep growing, especially if Tourism Taranaki can make good their growth projections. Prices have certainly gone pretty crazy though and I hope the market pulls back to a more realistic level but who knows??
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