First Timers, What have we done???

[Meehole]

Hindsight is a great thing, and my comment about whether or not they did the right thing is based on todays market conditions.
Nobody knew that the Akld market was going to take off after the GFC like it has, nobody could predict that property values would slump then fire up after an earthquake in Christchurch.
For someone dipping their toes into property investment for the first time I personally think they have over committed.
How do we not know that Whangarei will take off once the holiday highway is completed or once Marsden Point is really firing? I hear that they already bus staff from Whangarei into Marsden Point as there is not enough accommodation around Ruakaka.
I was told 9 months ago that our dairy prices would drop because of the competition in Europe and that same person told me that house prices would come back if not drop so best to sell the rentals and to invest the money into our construction company building smaller more economical homes to meet the market.
How can it make financial sense to buy a house for mid $800k spend $80k renoing it and then rent it for $680 week? North Shore Auckland.

[Meehole]

Meehole


...........

Yes but doing MY dough does not amount to $1300 a month top up. And I pursued those tenants with a vengeance, still would rather hang onto the $29 week in PM fees at the beginning than hand it to someone else to check the rent goes in each week.

[speights boy]

Yes but doing MY dough does not amount to $1300 a month top up.

Never said it did.
But when rossco wrote re yearly expenses

Property Management at 7.5% plus GST

.........1,466

you countered that until recently that wasn't a cost hence your return was higher.
However, in reality, you admit yourself that it is usually better if people pay for a PM if not hands on.

[Rosco]

There isn't a perfect solution or answer. In 5 years time we will all know what we should have done.

But these arguments show there are lots of different options and lots of different strategies. Every investor has different equity, different cashflow and different appetite for risk.

If you properties are under 8% gross yield, they are likely to be negative going forward. So it's important to review your properties and the returns, and ensure they still meet your needs. If you think there will be no capital gain, and the property is costing you money why would you keep it? [this is a general comment and not saying Meehole or other posters are going to get no capital gain]

Ross