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Originally posted by Gary Lin View Post
If bought right at the right price and the right time, it more than doubles every 7 years.
Your point?
Can you acurately time the market which is what you are suggesting.
That is probably more acurately called 'speculation' than 'investing'.Last edited by Wayne; 16-09-2015, 11:38 AM.
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Originally posted by Wayne View PostAnd if you brought at the wrong price and the worng time it doesn't.
Your point?
Can you acurately time the market which is what you are suggesting.
That is probably more acurately called 'speculation' than 'investing'.
imho
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Originally posted by Wayne View PostAnd if you brought at the wrong price and the wrong time it doesn't.
Your point?
Can you acurately time the market which is what you are suggesting.
That is probably more acurately called 'speculation' than 'investing'.
The 'wrong' time is not holding long enough!
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Originally posted by propertybuyingNZ View Postproperty is a long term game, not 5y but 10+, even 20 years and an average it doubles in 10y, so if you do not need to sell (as it supports itself, good investment, etc, etc) then it does not matter when you buy.
imho
return is king .Last edited by BlueSky; 16-09-2015, 11:30 PM.
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Originally posted by propertybuyingNZ View Post$450,000/$130,000 / 1.2 = 288%
but I am sure you meant something else, happy to hear your view.
Auckland house prices have increased up to 4x in a decade, and as low as 1.4x
Adjust for inflation and houses actually got cheaper in some decades.
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Originally posted by elguapo View PostAre you going to post the inflation adjusted version of that graph?
But I don't so I won't have that graph at all.
Not that I need it.
Magic of inflation and leverage, is that the loan amount stays the same (if the investor doesn't topup), or reduce (P&I).
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Originally posted by BlueSky View Postyes but question is this a gold or a lemon. if you are losing money and banking on capital gain and it doesn't happen (think GFC) then what ? 3 or 4 per yield on the hope that it "might' go up . factor in a 1 % rise in interest costs or a major reno , then what ?
return is king .
The way I see it: Investing for capital growth is the very same as investing in company stocks. You are not doing it for the lousy dividends you get once a year but in the hope the company succeed, now you are not buying the crappiest shares out there has no chance to go up in value, but you buy Apple and Facebook, etc. Same with property, you buy home and income, good location, etc.
And then people invest in start up companies too, what is waaaaaaaaaaaaay more risky than just a property with low yields, of course the reward can be much bigger.
anyway, I am not advocating investing in low yield properties for capital gain only, I am on the side of a balanced approach when you have multiple and different eggs in many different baskets
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Originally posted by propertybuyingNZ View Postits the same than with anything you buy, you obviously not going after the lemon (or a crashed car, or a used TV or whatever)
The way I see it: Investing for capital growth is the very same as investing in company stocks. You are not doing it for the lousy dividends you get once a year but in the hope the company succeed, now you are not buying the crappiest shares out there has no chance to go up in value, but you buy Apple and Facebook, etc. Same with property, you buy home and income, good location, etc.
And then people invest in start up companies too, what is waaaaaaaaaaaaay more risky than just a property with low yields, of course the reward can be much bigger.
anyway, I am not advocating investing in low yield properties for capital gain only, I am on the side of a balanced approach when you have multiple and different eggs in many different baskets
Well in a true sense, you can't solely invest in capital gains.
A successful Auckland investor needs BOTH capital gains (equity) and cashflow to grow a portfolio.
However, when the investor enters the market, the market condition may not be perfect, not like in the text books you read.
So you will need to adjust the strategy according to the market conditions, and buy accordingly to suit the investors needs.
Right now, there is no cashflow in Auckland, barring sh!tty areas generally...well depends how you define cashflow, banks need 10%+ to grow a portfolio due to P&I and 75% rental income, and some BS 7%+ serviceability calculation they use internally.
People invest in this market will stop pretty quickly due to lack of cashflow. But in the long run, cashflow will return gradually with rising rents and maybe reduction in the interest rates and OCR (Europe and US are good examples of the long term trend). Also 2009 market will come around every cycle where cashflow properties appear in Auckland.
Yes you are correct that a balanced approach is needed, but this approach should be taken long term, while a short term approach may be required to accelerate progress through buying capital gains (during a rising market) or cashflow (during a slump or recovery) depending on market conditions.Last edited by PTILoveYou; 17-09-2015, 11:26 AM.
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