Where to buy? Know little about NZ

[HappyCamper]

Looking for some pointers on where to start, what areas to look at.

I have about $120k in equity in Australian property that I'm looking to pull out and invest in NZ. I live and work in Australia. I have a small portfolio of investment properties (Sydney and Brisbane). I've typically invested in high yielding (low by NZ standards, or so it seems) areas of capital cities, so have been closer to the city's fringe and often in migrant dominated suburbs. At the time of purchase, these have typically been around 6% gross yield for a run of the mill house and about 8% gross yield for a house + secondary dwelling.

Ideally, what I'm looking for is a house with at least 600sqm of land with good transport links to a major CBD. Close to a major hospital or major industry would be good. Not sure if I can buy a cheaper property so that I can buy a second one sooner?

[PTILoveYou]

Auckland would be your 1st and best option, as you have direct flights from Oz to Auckland to make travelling easier.

Capital gains is also best in Auckland.

If you look into west and south auckland, you should get 6%+ gross yields, and the land area you desire.


Other option could be Christchurch (NZ's 2nd largest city after Auckland), as I assume there are direct flights to Oz also?

[ScottSI]

Gary we are not that small in CHCH, we do have direct flights to Auz.

Also direct flights into Wellington and Queenstown from Auz.

Buy in Queenstown or Wanaka and you can have a ski holiday when you come over to clean out your gutters once a year!

[Wayne]

Yeah - Gary needs to get out more

[PTILoveYou]

I live in Auckland, so of course I'm bias towards Auckland, what do you expect

[HappyCamper]

Thanks for the replies guys! Yes I can confirm we have direct flights to Christchurch and even Queenstown from Sydney

I did a bit of digging around Papatoetoe and made a few enquiries. But I'm seeing asking rents around the low 400's and asking prices around $500k. Do I need to go even further south for higher yields?

On another note, I see Auckland has had a good run in 2013. Does anyone have any thoughts on whether other markets like Christchurch or Wellington might play catchup in 2014?

[Wayne]

On another note, I see Auckland has had a good run in 2013. Does anyone have any thoughts on whether other markets like Christchurch or Wellington might play catchup in 2014?

You would have to consider why they would.
Becauee one city rises heaps doesn't mean another at the other end of the island or further will.
I could give you an opinion but it would be just that - an opinion.
You need to read all you can to devine the reason for Aucklands rise and see how that would drive other markets (or not).

[Glizzle]

Looking outside of Auckland is great, if investing in Villages is your thing.

[Wayne]

Looking outside of Auckland is great, if investing in Villages is your thing.

Oh dear...

[donthatetheplayer]

HappyCamper - what are you wanting to achieve through the purchase of this property?

[HappyCamper]

HappyCamper - what are you wanting to achieve through the purchase of this property?

I'm hoping to achieve two things. To have a property with minimal holding costs and to be able to pull out equity within 5 years to make a repeat purchase.

[HappyCamper]

Looking outside of Auckland is great, if investing in Villages is your thing.

Are you inferring Christchurch and Wellington are villages, or are you saying I should look at regional towns?

[elguapo]

I'm hoping to achieve two things. To have a property with minimal holding costs and to be able to pull out equity within 5 years to make a repeat purchase.

Why are you buying in NZ then? All those travel and management costs are not going to do your overall holding cost any good at all.

[HappyCamper]

Why are you buying in NZ then? All those travel and management costs are not going to do your overall holding cost any good at all.

Quite simply - the yields are higher in NZ than Australia at this point in time. That, and the diversification of risk.

[elguapo]

Yields in Auckland are not much different, so your looking at regional centers then aka villages! That doesn't meet your requirement for proximity to CBD, there's really only two of those in NZ.

Diversification wise, it doesn't seem to be much of a diversification at all, but at a much greater cost.