Investment properties

[Angry Puppy]

So who amongst us has investment properties? What advice or strategies would you offer?

I've been looking at magazines like Kiwi Property Investor, but they seem to be very much self-serving. I've read some pretty good books. Dolf De Roos (?) has done some good ones, especially the one he did for the Rich Dad, Poor Dad series. I know a fair bit about the process and what is involved, but there is no substitute for experience. So come on guys, tell us your experiences (keep it clean). :niceone:

FB

[Lou Girardin]

After 11 years in Real Estate, my advice is; don't believe a word Agents/banks/investment guru's say. Wait to buy at the bottom of the price cycle, say 3 to 4 years. Prices will stabilise and fall soon. People who bought in the last two years will be bailing out of properties then too. Do your homework on rental rates and demand. Be prepared to do the property management yourself, don't rely on agents.
And ALWAYS use the worst case scenario.

[jrandom]

Yes, Lou speaks wise words.

It's been a obvious for the last year or so that the best time to buy hooses will be about three years from now (interesting that Lou gives about the same number I came up with) after regular old inflation has had a chance to catch up with what's left of the property bubble, and before the next one starts.

Remember, the Invisible Hand of Adam Smith watches over all, and smacks until pink the bottoms of those who think that the basic rules of supply, demand and value ever cease to apply in a market.

[FROSTY]

Ill third that advise with one proviso. Try out of town.
it seems that houses in smaller towns follow the same trends as in big citys -bu they tend to price rise a little behind the citys.

[Ghost Lemur]

And the golden rule my Dar(Sp?- funny all the years and I never thought to find out how to spell it, then again maybe I did and I've now just forgotten. Sure one of our Scottish kin will correct me if necessary) gave to me, although I've never been in a financial position to use it.

Worst house on the Best Street.

And obviously what has already been written about buying low selling high. Tis truely amazing just how many people fail to follow the simple rules.

[Blackbird]

Depends on whether you're investing for rental, capital gain or both. We bought a place right by the harbour just outside Coromandel town 10 months ago and it's increased well over $100000 in that time. People buying bare sections up there are also getting big capital gains as Coromandel east coast prices go through the roof. We couldn't be arsed with tenants so just went for capital gain and let it out occasionally to pay the rates.

[Firefight]

why houses ?

Try commercial !

Also if your into reading, "Jones on Property", by Bob Jones, an older book, but a lot of what he wrote then makes sense today.(Happy to loan you a copy)

Also some stabilty has returned to the share market, just watch who you use as a broker.

Finally Beware of current trend in interst rates !

Good luck

F/F :sunny:

[KATWYN]

Tenants are the biggest stress I have ever encountered.
Employing people and running a business is a walk in
the park in comparison.

It was tempting to pass the stress on to a property manager but
at the end of the day they cost as well, and if a tenant
doesnt pay - property manager takes no responsibility.
They also go ahead and organise serviceman in to do
maintainence jobs that you (or in my case hubby) can
do for NO cost

Best thing we ever did, was lower the rent by 25% and put
in family members to live there (or people you know/trust).
In the long run it has been priceless. (have also heard other
property owners say this too)

[The One]

So who amongst us has investment properties? What advice or strategies would you offer?

I've been looking at magazines like Kiwi Property Investor, but they seem to be very much self-serving. I've read some pretty good books. Dolf De Roos (?) has done some good ones, especially the one he did for the Rich Dad, Poor Dad series. I know a fair bit about the process and what is involved, but there is no substitute for experience. So come on guys, tell us your experiences (keep it clean). :niceone:

FB

What the fuck has this got to do with motor bikes, if you want that sort of info then piss of to a Property Investors website. I'm sure KPI hav one around somewhere.

Cheers

[Juan]

Best thing we ever did, was lower the rent by 25% and put
in family members to live there (or people you know/trust).
In the long run it has been priceless. (have also heard other
property owners say this too)


We also do this, again the way forward, no doubt.
When my dear old Mum was alive her house was rented out when she was unable to look after herself and took a flat in sheltered accom, we knew nothing of any of the tenants, complete pain in the arse,finished up selling the house. could of killed the last guy.

[jrandom]

What the fuck has this got to do with motor bikes, if you want that sort of info then piss of to a Property Investors website. I'm sure KPI hav one around somewhere.

Heh. Hmmm.

Don't you think you should stop trolling soon, though? Eventually everyone will just block your alias, and you'll just be wasting time that you could spend catching some sunshine, drinking a beer or reading a good book.

If you're actually a discrete oxygen-consuming real-world individual, located in New Zealand, who (as it seems) doesn't own a bike but thinks that Fireblades look cool, why not just start a new thread on the topic, admit everything and ask for advice or assistance with getting into motorcycling?

You might be surprised at the level of support you get. Particularly if you manage to be funny.

[MikeL]

Tenants are the biggest stress I have ever encountered.


Don't get me started on the hassles of having tenants. I am now a happy ex-landlord. By all means buy for capital gain, but keep the place empty.
You have been warned.

[jrandom]

Don't get me started on the hassles of having tenants. I am now a happy ex-landlord. By all means buy for capital gain, but keep the place empty.
You have been warned.

At this point, I'd just like to recommend myself to the KB community as the perfect tenant, and an ideal consideration for stable income on a 25% drop in rent for that well-maintained three-bedroom house that you're worried about keeping in top shape.

Not that I'll be needing to move at the end of the year, or anything. No no. An opportunity that tempting, for an aspiring low-risk landlord, would just be too good to be true.

:innocent:

[Angry Puppy]

Some good tips there guys. I was hoping to get my first investment property this year. start with a few for income, then once stable by a few more for capital growth. a few of you have mentioned waiting a few years or looking outside of town. I guess if I wait, I can always save up a larger deposit.

"Success is the result of good judgement. Good judgement is the result of experience, and experience is the result of bad judgement".

FB

[toads]

hi there, we have a property we have just listed on the market and hope to sell, hopefully to an investor in the rental market, we bought it 3 years ago and have used it to help our kids out, haven't made a cent out of it obviously, if it doesn't sell we won't be too stressed out we won't have any problem renting it out, there's a huge shortage of rental properties here, but if we don't sell and end up renting we will also do as Katwyn mentioned and rent a little below market rental in order to be choosey about our tenants, as it is nearly freehold our overheads are minimal and either way we win, I would not recommend getting a big mortgage at this point in time as the interest rates look set to soar and it is possible to over capitalise when that is the case. Lastly it is best to buy the crappiest house in a good street, it will increase in capital value, and at least you will get some guaranteed return.

[Motu]

It seems everyone I speak to in Auckland has an investment property,bought on the back of inflated house prices (An ex State 3 bdm in Mt Roskill is not worth half a million,but it's what they pay) builders are building at an ever increasing rate - the rental market is now flooded,I have a guy in today who says he can't rent out his flat....the tenant is now starting to contol rent prices,not the landlord, with interest rates going up Aucklands property market will soon start crumbling around the edges as marginal rentals are dropped.If I was going into an investment property (dream on) I'd look for somewhere the prices haven't been inflated over real value (that Mt Roskill house was $220,000 3yrs ago,it's real worth is $275,000 max),or wait as others say and catch them falling out of the sky.Good luck,don't listen to me,I've done it totaly wrong,but that's not new teritory.

[jrandom]

the rental market is now flooded,I have a guy in today who says he can't rent out his flat....the tenant is now starting to contol rent prices,not the landlord

About damn time too. Rental prices have been going absolutely mental over the last year or two. Four hundred dollars a week for a smallish three-bedroom house in a non-central suburb? Please.

[Blackbird]

Very wise words from Firefight about brokers! If you’re investing in shares and the like, some brokers have vested interests and it’s darned hard to figure what brokers are genuinely independent. I had an interesting experience a while back talking to the financial advisor to several of NZ’s biggest company superannuation schemes. He said that as far as he was concerned, there were only 2 or 3 brokers that he would trust with his money because of their genuine market knowledge. These people seem to work by word of mouth and don’t advertise. I went to one of them and have never regretted it. The person concerned went to a lot of time and effort to put together a portfolio that was designed specifically for our needs, not some off-the-shelf solution.

Geoff

[Zapf]

re brokers / share traders / advicers. My last job was working in a company that involves most of NZ's banks and share brokers as our clients, therefore had a lot of face to face time with them. You must keep in mind that they are not super-humans, and sometimes their guess is as good a yours. The key to not loosing in the markets is money management not share management, know when to get out. As long as u are winning over 50% then you are winning.

[mangell6]

The first book covers the principles, the second gives you the seven areas to look at when buying a property and the third is a real meaty book with detail.

"Rich Dad's ADVISORS" - Real Estate Riches - Dolf de Roos ISBN 0-9711652-0-3
Timing the Real Estate Market - Craig Hall ISBN 0-07-142195-5
Building Wealth Through Investment Property - Jan Somers and Dolf de Roos ISBN 0-473-03473-5

Tenants - Weed them out by getting them to complete an application form that includes a credit reference. Also invest in your people skills the majority of people do not think like you.