Property rocks

White Heron - that rarely happens with good tenant selection, and a decent-sized bond helps. I'm pretty easy on my tenants - pay the rent, respect the property and the neighbours. That's it or else....
I'm coming around to Cap and Duncan's way of thinking - not only in our present bull mkt but forever.

Duncan my property investment was an airport looking at 300% in 18 months plus income beats playing with rental properties My own house up just over 100% in 7 years Shares in ANZ bank up 100%in 6 years plus the dividend yield is 20% per annum now on what I paid for them and no hassles

[whiteheron]

macdunk

You say that " a complete dummy will make money with property ; you cant say that about shares "

Fair comment , I agree with that
Maybe it says something about NZers though !

Sharemarket investing by the NZ public , I believe , is low by world standards
( I stand to be corrected on that though )

It is well known , of course , that the average NZer loves his property --- perhaps he ( or she ) feels that they know that in the long term property will be okay , but they know little or nothing about other forms of investment , especially share investments

It certainly helps to be savvy on many matters to get involved in share investing and even more so share trading

[Cooper]

There have been a few warning shots fired by the Labour govt. regarding the use of incentives and penalties to induce kiwis to move money from property into other vehicles. Whether that happens or not, the intent is there.

[whiteheron]

Longtack

You sound like a very good property investor and good luck to you --- you have obviously got it sussed

Perhaps I am not cut out to be a landlord

The stockmarket is for me

[trackers]

more specifically, anyone have any ideas on the current state of the property market - Has it peaked, still going, or about to go backwards?

and interest rates.... up or down?

Whilst i think macdunk is correct in saying that (over a long enough period of time) any fool can make money in property....but as far as short term decent gains go its not all that simple.

Disc: Looking at consolidating my funds into a Chch rental property, given the current state of the sharemarket.

[Bling_Bling]

The properties in our area seems to be doing very well, thank you. How long will it last? Who knows. We learn from 1987 and 1997 and put it into practice for todays market and thats all one can do.

http://xtramsn.co.nz/money/0,,5489-4281065,00.html

[elfer]

quote:Originally posted by duncan macgregor

ELFER, You still dont get it. I showed that the greatest dummy on earth would be in front and you quible the how much factor. macdunk

Either you don't get it either, or we are talking at cross purposes. If your definition of a good investment is one which gets a few percent above inflation and the income covers the costs (the farmer leasing the land example), then why not invest in govt bonds at a few percent over inflation (even post tax)? They are genuinely a riskless investment. Land is not.

I'm getting the feeling that you and I have an extremely different view of the underlying risk of property investment. The interesting thing is that I think we both look at historical returns to come up with this view...

[duncan macgregor]

ELFER, My idea of a good investment is a 10pc deposit of your own money,self funding, and a capital gain of 10pc pa. How much do you think your initial deposit is worth in 10 years?. It is a better investment than owning a gold mine. This is being done all round you, at this very moment, open your eyes and start to think. I even gave you an instance where the countries biggest dummy buying a block and getting a farmer to pay the rates for grazing comes out on top. Your responce was he might do better elsewhere. We then have people saying the rules might be changed. WOOPY DOO we will then change our investment strategies. macdunk

[elfer]

Well see this is my point. You don't seem to understand - for a start you contradict yourself:

[

quote:ELFER, My idea of a good investment is a 10pc deposit of your own money,self funding, and a capital gain of 10pc pa. How much do you think your initial deposit is worth in 10 years?. It is a better investment than owning a gold mine.

This implies that it is easy (or even possible) to find rental properties for which the rental yield (after costs) covers a 90% mortgage. At todays interest rates that's not gonna happen much below 9-10% yield. To be fair, if you find and hold such a property, even if the capital gain is nil you are "earning" the mortgage rate on your investment (approx), and the effects of leverage on any capital gain is strong...

... but you have to recognise the risk inherent in having a 90% mortgage. It is risky, even if you don't believe it is.

quote:This is being done all round you, at this very moment, open your eyes and start to think. I even gave you an instance where the countries biggest dummy buying a block and getting a farmer to pay the rates for grazing comes out on top.

And then you post this - much closer to the initial subject matter (Capitalist's speculative buy of coastal land). You can't buy either the coastal land or land close to the city which is leased to farmer for grazing and gear it - the cashflow will be very negative. It might be low risk (if you don't gear it), but arguably low return too. If (like the coastal land) the return was very high then it must have been a risky purchase at the time it was made, otherwise the price would have been higher...