Why housing costs are so ridiculously high

[jasonu]

Bad part is about 350-450K. Good part is about 500K.

When did Otara get a 'good part'?

[jasonu]

and a landlord is more likely to get someone in to do work on a house so you have some expenses to clam vs a home owner that will do the job him self, or get a mate who's a sparky or plumper to do it for a box of beers.

Any landlord that does that just to get a tax write off is stupid and should talk to a tax accountant. You end up spending $100 to get a $25 tax rebate. Spending money on stuff or services you don't really need just to gain tax savings is a backwards move.

[sidecar bob]

I rent a commercial property off me. That has advantages, or so my accountant tells me.
At least I have a fuckin awesome landlord anyway if nothing else.

[Voltaire]

you can longer clam deprecation on the house and now add to that the 20%+ deposit leaves less of a tax loss.
and a landlord is more likely to get someone in to do work on a house so you have some expenses to clam vs a home owner that will do the job him self, or get a mate who's a sparky or plumper to do it for a box of beers.

Sparky for a box of beers.... hope your not expecting a COC for that.
You only need 20% deposit to buy if you don't have any equity in a house already, hence 'investors" buying what used to be 1st home buyers houses.
Lots of things you can claim, fees, interest on the borrowed money, rates, insurance, agents fees ( if you use one), It is easier to get repairs done as Tennants don't like you around on the weekends. I don't think you can make a reasonable yield on Auckland houses now, probably have to hope for capital gains. Its all a bit stuffed really. Still the housing minister thinks its all good....Nick Smith...that name rings a bell.

[Woodman]

plumper to do it for a box of beers.

Done too many jobs for beers is probarbly why he/she is a obese

[Ocean1]

I rent a commercial property off me. That has advantages, or so my accountant tells me.
At least I have a fuckin awesome landlord anyway if nothing else.

Good move. I've been looking for a new landlord myself...

[BMWST?]

Any landlord that does that just to get a tax write off is stupid and should talk to a tax accountant. You end up spending $100 to get a $25 tax rebate. Spending money on stuff or services you don't really need just to gain tax savings is a backwards move.

i doubt any landlord spends money that doesnt NEED to be spent.

[jasonu]

i doubt any landlord spends money that doesnt NEED to be spent.

Fair point and neither should they. The same could be said for any business or business owner.

[Oakie]

Now I see the problem, we are living in apples, not peaches.
I once read about this kid that lived in a giant peach & it worked for him.

Perhaps we should be building split level bananas?

[Winston001]

you can longer clam deprecation on the house and now add to that the 20%+ deposit leaves less of a tax loss.
and a landlord is more likely to get someone in to do work on a house so you have some expenses to clam vs a home owner that will do the job him self, or get a mate who's a sparky or plumper to do it for a box of beers.

Yeah I know this happens currently but it is an abberation. Illogical.

I've advised people buying property for 30 years (from the late 1970s) and nobody ever bought a property where the rent didn't cover the mortgage plus rates insurance etc.

And yet today that is supposed to be the clever thing to do.

This does not make sense and eventually property values will fall back to historic fundamentals.

[TheDemonLord]

Yeah I know this happens currently but it is an abberation. Illogical.

I've advised people buying property for 30 years (from the late 1970s) and nobody ever bought a property where the rent didn't cover the mortgage plus rates insurance etc.

And yet today that is supposed to be the clever thing to do.

This does not make sense and eventually property values will fall back to historic fundamentals.

Not so, it makes perfect sense:

You less the loss you are making on your investment property from your normal income - so instead of making 70k a year, your net income (gross income + Net Loss) is now 59k, and you aren't paying tax in the higher tax bracket.

Meanwhile, since you are paying off the mortgage on the other house, you are effectively getting a free ride (increasing your net wealth)

It's something that if I can wrangle my financials - I would like to do in the next 5-10 years

[swarfie]

Not so, it makes perfect sense:

You less the loss you are making on your investment property from your normal income - so instead of making 70k a year, your net income (gross income + Net Loss) is now 59k, and you aren't paying tax in the higher tax bracket.

Meanwhile, since you are paying off the mortgage on the other house, you are effectively getting a free ride (increasing your net wealth)

It's something that if I can wrangle my financials - I would like to do in the next 5-10 years

FFS, I earn wages, I pay taxes. Why can't everyone else pay taxes the same way I do. If that was the case the whole bloody country would be doing okay, not just the ones that are NOT paying their share of the taxes.

[Oscar]

FFS, I earn wages, I pay taxes. Why can't everyone else pay taxes the same way I do. If that was the case the whole bloody country would be doing okay, not just the ones that are NOT paying their share of the taxes.

Half of all NZ families pay no income tax.

[Banditbandit]

Lots of things drive up house prices ...

To me the bottom line is that anyone who buys real estate at present expects to sell it for a higher price ... that just pushes prices higher and higher ...

The neo-liberal changes of the 1980s, and onwards, changed the concept of home ownership in Godzone from one of owning your own home for security (the landlord can't boot you out) .. to one of an economic asset from which people can make money ... either by capitalizing the asset (a dead giveaway) by borrowing against it and investing that money; by charging rent for investment properties; and finally by the capital gains when it is sold ..

Security of home has changed to an economic model - and home owners invest money in the capitalist schemes (and they lose their investments and homes at the whim of the capitalist schemers who walk away scott free ...) Once again we are sucked in by the politcal progoganda perpetrated by the capitalist powers ..

Why do you think 5% of the world's population have 90% of the wealth? they conned us into their money-making schemes and stole our money ..

[caspernz]

Four months ago sold our house in Wellington, just bought another here in Auckland. All in all I don't see a big problem in Auckland, but being just a blue collar worker my wife and I bought within our means close to our places of work. By close I mean 10 min drive for me, 10 min walk for her.

Auckland has become a lot more cosmopolitan in the 10 years we were away though. The Asian and Indian influences are much more obvious now. More representative of the worlds' population I suppose.

Don't subscribe to the idea of non-NZ residents being able to buy property here though.