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Junior Member
There is still a lot of houses around that are cash flow positive.Areas like Papakura,Manurewa,Otahuhu.For investing- thats not a bad start and for owners its a start- then work your way up.Its not all doom and gloom!
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Member
Arguments for and against the benefits of property investment over others are never comparing like with like.
Where can the average investor gear up with 80%+ of other people's money to earn a potential profit?
Where can they hold their investment through a slump that wipes out much of their own equity other than with property?
Even if all other factors are equal the avergae property investor is protected by the lender through most problems because the lender (bank?) has an interest in holding prices up as a protection of its own equity.
Note that under the lending ratios that banks use to measure risk, property has a real edge over any other.
Yes I can use my built equity in property to invest in other assets but only after I have created that equity. Not only that but it is quite possible to outstrip the returns on property using similar gearing.
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Originally Posted by loofa
Arguments for and against the benefits of property investment over others are never comparing like with like.
Where can the average investor gear up with 80%+ of other people's money to earn a potential profit?
Where can they hold their investment through a slump that wipes out much of their own equity other than with property?
Even if all other factors are equal the avergae property investor is protected by the lender through most problems because the lender (bank?) has an interest in holding prices up as a protection of its own equity.
Note that under the lending ratios that banks use to measure risk, property has a real edge over any other.
Yes I can use my built equity in property to invest in other assets but only after I have created that equity. Not only that but it is quite possible to outstrip the returns on property using similar gearing.
without losing substantially more than your original investment if things turn to custard ?
Dont hate the player,hate the game
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Member
.....which is the same for property.
And you cannot get out in the next five minutes..........or without a huge commission/legal cost
And you cannot "short" a rental property when the market does fall or protect your property portfolio by lending part of it to a sucker and buying it back cheaper at a later date.
I am not advocating shares v property but there are just as many property myths as there are about other investments.
Last edited by loofa; 07-07-2011 at 08:55 PM.
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Originally Posted by loofa
.....which is the same for property.
And you cannot get out in the next five minutes..........or without a huge commission/legal cost
And you cannot "short" a rental property when the market does fall or protect your property portfolio by lending part of it to a sucker and buying it back cheaper at a later date.
I am not advocating shares v property but there are just as many property myths as there are about other investments.
yes point taken Loofa, I suppose those who bought at the peak of the property boom and those who have inadvertantly bought leaking homes would know all about this!
Dont hate the player,hate the game
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Originally Posted by robo
yes point taken Loofa, I suppose those who bought at the peak of the property boom and those who have inadvertantly bought leaking homes would know all about this!
As would numerous investors who totally underestimated the cost of maintaining a domestic property.
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Originally Posted by fungus pudding
As would numerous investors who totally underestimated the cost of maintaining a domestic property.
Us kiwi's just love investing funds into old worn out low yeilding rental properies
"With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future." — Carlos Slim Helu
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Originally Posted by JBmurc
Us kiwi's just love investing funds into old worn out low yeilding rental properies
I have two properties on the coast here in Hawkes Bay which were purchased about ten years ago for low 80's cash each and return 18500 each annually not exactly low yeild , both are valued at over triple this original cost and would be attainable in the current market.
Had to do a bit of painting myself over the years the odd plumber and electrician thingie now and then, otherwise mainance has been minimal.
I think what you are saying is this scenario is ancient history now and there are far better investments to be had , this is timely for me as I find my self scouring the property press looking for another addition at the moment !!!
Dont hate the player,hate the game
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Originally Posted by robo
I have two properties on the coast here in Hawkes Bay which were purchased about ten years ago for low 80's cash each and return 18500 each annually not exactly low yeild , both are valued at over triple this original cost and would be attainable in the current market.
Had to do a bit of painting myself over the years the odd plumber and electrician thingie now and then, otherwise mainance has been minimal.
I think what you are saying is this scenario is ancient history now and there are far better investments to be had , this is timely for me as I find my self scouring the property press looking for another addition at the moment !!!
yeah property was great buying but those days are over unless property prices crash unlikely or average incomes go much much higher ...
I had for few years a 4brd 1940's brick/roughcast new roof rental 15min walk to the Invercargill SIT use to get 300pw paid 145k sold it for 187k I see years later guys trying to get over 200k for it now also had a 14% yeild 8 block of flats overall stressful investments even with a property manager.
much rather run my own share portfolio which like the rentals has some of the banks money invested ..
everyone different though an I do hope once we've paid off are own home too buy a few debt free near new rentals for some passive income
Last edited by JBmurc; 08-07-2011 at 12:47 PM.
"With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future." — Carlos Slim Helu
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Originally Posted by JBmurc
yeah property was great buying but those days are over unless property prices crash unlikely or average incomes go much much higher ...
I had for few years a 4brd 1940's brick/roughcast new roof rental 15min walk to the Invercargill SIT use to get 300pw paid 145k sold it for 187k I see years later guys trying to get over 200k for it now also had a 14% yeild 8 block of flats overall stressful investments even with a property manager.
much rather run my own share portfolio which like the rentals has some of the banks money invested ..
everyone different though an I do hope once we've paid off are own home too buy a few debt free near new rentals for some passive income
Still sticking to my theory that we will see a rise in property prices in the medium term as I believe emigration will be opened up majorly in nationals 2nd or 3rd term to jump the gun on all the other countries that have the same problem ( note to self , get more Ryman )
Dont hate the player,hate the game
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