Cant decide what type of property to invest in???

[Adman25]

Hi all

My brother and I are wanting to put our savings into an investment property in the wellington city area. We both are from wellington, but are working overseas so we are looking at buying a low maintance property as we will not be able to maintain it ourselves.
We have 120k combined as a deposit, but we dont want to be tied down with a huge loan so we have a budget of 300k. We have been looking on the internet at apartments, units in the CBD and houses a bit further out but still in the greater wellington area. Its very dificult to judge propertys from the internet but we will both be home for february and march 2010 and would like to buy something then so we can see in person what we a buying.
Regarding the property we would like something we can live in if we wanted to later on so we dont want to buy a investment only property leased out to universitys. Nothing to small, a minimum of two bedrooms and 50 sqm for an apartment and slightly larger on the border of the CBD for a unit.

Regarding apartments we would be looking for something easy to rent out in a good area of town, easy to sell in the future with maintenance looked after by the Body corp also the possibilty of being managed for us. Some questions i have that i cant find an answer for are; what kind of apartments are in demand and will be in future regarding size Sqm,Bedrooms,location, age of building if a retrofit or purpose built.

Regarding units are they easy to rent out? What are good areas to buy a unit in? Who maintains the unit the owner or the land owner? Are there body corp fees for a small complex or two unit propertys?? What is yield like compared to city apartments? Do unit prices stay around the same price or is there possibilty of capital gains.

Regarding houses we would be looking in johnsonville, newlands, for a small house with a bit of land dont know if you could get one in our budget?? Are they easy to rent in these areas? Are they easy to sell?

So basically we dont know what to buy - apartment, unit or house, we dont know what apartment / areas in town to stay away from i've read one post saying stay away from the terrace apartments because of retrofits and age. The only apartments in our range seem to be the stafford house which is investment only, vic central which are tiny apartments and the marin square te aro apartments. What is wrong with all of these to be the only apartments up for sale??

Are there any new build apartments being finished soon? There is one new building advertised on 72-78 taranaki street 2 bedroom 46 sqm $310k does anybody know about these.

Any help would be much appreciated i look forward to hearing from you

[donna]

Have a look at this discussion Adman25. It has good pointers on what to consider on apartments.

cheers,

Donna

[Niall]

Adman,

If you are going to live in your property when you come back to Wellington that changes what you need to look for.

Are you prepared to live in a 50sqm shoebox in the city, a 2 bed unit in J'ville or a 3 bed house in Upper Hutt?

You can pick up units in Crofton Downs, Eastern Wellington, Petone and Karori for under $300k.

The best lending my broker got for a non NZ resident was 70% so your budget seems to be on the button. Have you finance approved? Depending on the property you want to buy a lender may need more than the normal deposit.

Keep the questions coming. Every investor here started with ONE.

All the best,

Niall

[Adman25]

Thanks for the replys so far

Hi niall

I am a NZ citizen born and raised in wellington just working overseas due to what i do for a job. regarding property size if 50 sqm is a shoebox i live in a matchbox so i have no problem living in a place that size for a while.I work on a small boat and my living quarters are 5 sqm including a cabin i have to share with another person bathroom/shower and eating area. johnsonville/newlands would probably be the furthest we would like to own from the city. Crofton downs,karori i would consider.

you have posted on my other thread regarding the soho apartments in taranaki st i am looking more towards the apartment front as i would only want to live in it untill i found a home i would like to buy and live in as a second property. I am looking at paying my half of the 300k off by the end of 2010 having 50% equity in the property to buy a house and to use the rent to help pay off my 2nd property.

look forward to hearing back from you

[Dean@Massiveaction]

Niall would be the man to help you find something. House on land over apartments any day IMHO.

[Adman25]

I will have a good look out for units and houses out of town see what i can find

what are some good areas in demand by tenants to buy in the wellington area??

[revdev]

Newtown, Mt Cook, Hataitai, Mt Vic...

[Aston]

House on land over apartments any day IMHO.

Agree with the house and land option.

Don't forget Petone.... Has always been a popular option and very easy commute into the CBD or Central Hutt.

[Adman25]

sounds good i started off looking at houses with land but got scared off with the possibilty of this new tax law been passed next year the deemed rate of return of 6% so i started looking for a higher yield investments that make money off rent instead of capital gains would i be right in what i am saying? I just took an amature guess.

With regard to this new tax proposal would this include your first home?? or whould it just be anything you are making money off i understand if you are living in the home the tax does not apply but as i will be renting it out and it being my first property would it still apply?

petone is a very easy drive to wellington i did forget about petone when talking about central hutt are you meaning just lower hutt? what about upper hut?

thanks for all the help i want to get as much info as possible so when i come home in a month i can have a look at some areas i am interested in

[Odin]

Be careful

Do make sure that you have a very firm agreement when investing with friends and family. Ensure that all is very clear cut and every responsibility is allocated and that there is a relatively easy way out for all parties involved.

From what i understand it's not the best idea to look for an investment property with the intention of maybe moving in at one point or an other. Get legal (accounting) advice on that one before you proceed.

Good luck, I think now is a good time to buy though should you come back to me later I reserve the right to change my mind ;-)

Jesper

Oh, and get a house on land over apartments. I have an appartment and had the longest tenant in the building of 220 apartment at just under 2 years.