I wouldn't.
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Be patient.....then when you have lost all patience...dig deep and find a bit more.
My thinking is the following:
We haven't seen the worst of the real estate slump yet.
I believe the risk of trade barriers being put up is real, but low due to lessons of the past
I believe the risk to "credit barriers" being put up is real, and exceptionally high.
We need about 1 out of 3 dollars of credit in NZ sourced from overseas.
As nationalization continues and continues to accelerate in the banking/finance sector the political problems of lending money to foreigners when the banks are taxpayer funded will grow exponentially.
I think NZ will fair better than most through this mess due to our export production of needs rather than wants , but our Achilles heal is a need to import credit.
Leveraged assets will continue to tumble in my opinion.....we have at least one more leg down to go with property....possibly more.
Sorry to be all gloom and doom, but I think it will continue to get worse before it VERY slowly gets better.
But surely this can't continue forever. If first home buyers can't afford to buy housing, the current oweners will at some stage run out of possible buyers - and then what?
At some stage there has to be a correction, whether that is now or over a longer period of time. But we can't blindly believe that the value of unproductive residential property can increase continuously forever...
Depends on your goals. Are you in it for short term gain or long term enjoyment. I bought at the top of the market 25 years ago and have never sold. Sure it has dropped in vfalue at times, but it is my own patch of NZ and is owned by me.
Now it is worth 10 times that. That is only part of the equation. The house is now set up exactly how I like it, not how a landlord made it. The interior decoration and landscaping have been a fun hobby. The growth in value has also provided equity for other investments. You decide but consider your goals carefully.
No answer for that – there is not enough information to even begin to come to a sensible answer. are you on your own, have a family, renting at teh moment; looking at taking in flatmates. Got a steady job; want to travel; want some security, happy with risky investments; into DIY, Why not buy two – a home and a rental?– the list goes on. But there is enough information on this thread to come to an answer that suits your circumstances.
That whole idea is just a nonsense. First home owners can afford their first home. Always have been able to, always will. Its just that not all will be able and some can’t work out where their priorities lie while others blame someone else for their prior personal decisions or perhaps the timing just isn’t quite in sync. There are always buyers of something that is in demand. There will always be demand for property.
Property is very resilient. It handles depressions, recessions, population swings, SARS – you throw what ever you like at it and property has always increased in value over time. There is one constant – and that is in the developed world we need a roof over our head. A more variable constant is that our population will continue to grow – sure the greenies go on about over- population (actually global warming has distracted that one from them for a while) the world is ending blah blah – but for the next few generations at least the world will continue to expand. Land, bar coastal erosion does not go away and we as human animals have a innate desire to exploit that land to our advantage – that is buried so deep in our genomes that won’t change in a hurry.
Residential housing isn’t unproductive – it provides a roof over your head. Building shoe box apartments for non existent student s or holiday homes that take 5 hours to drive to or a myriad of other areas of property people biff their cash can be unproductive housing.
Keep down ramping the property market. Please d,o cos it will only give me more chance to accumulate more cheap assets. :D:D
Residential real estate hardly represents cheap assets. House prices will take a big hit over the next few years, so why not wait? They have dropped a little but are still way out of whack with annual earnings. The real estate bargains at present are the listed property trusts, with returns of 15 - 20% available and huge discounts to assett value. And not having to lsten to tenants explain how it wasn't their fault that a hole appeared through a gib-board wall etc. Damn sure I wouldn't 'invest' in a house or flats at present.
I'm certainly looking at buying a property here as interest rates are making renting more expensive currently you can buy for between 50k-100k less than cost to build (I've built 4 spec houses here)
and as population is still growing an with the ever increasing tourist numbers(yes even right now theirs thousands of tourist here) outside jacks point sections are far an few between with little land available to use in future booms
In time Queenstown will be fully built with nothing close by available outside high density apartments ,units etc IMHO we'll have 15yrs before the new qtr acre section with 4brd home to be built is long gone ,take jacks point out prob less than halve that time
Queenstown lakes pop growth 06-07=5.5% 07-08=3.8%
I currently own 8 rentals , 4 in Wanganui , 3 in Blenheim and 1 in Dunedin. Have just bought a house in Devonport as a family home as we have been renting since May08. I hope to double the size of my rental portfolio before the end of 2009. All new purchases will be cashflow positive at 100% gearing , hopefully $30-$50pw each. I don't care whether they are in Ponsonby or Putaruru as long as they produce instant weekly cashflow. 3 will go on 1Yr mortgages, 3 on 2Yr and 2 on 3Yr ... all below 6% and possibly all below 5.50% !! I have about 40% equity in my existing portfolio that generates cash at these interest rates ... I'am planning that finance won't be a major problem but realise it won't be a walk in the park either. It IS possible and its a great way to get out of your daily grind job and relatively low risk.
I'll keep you up to date with progress ...