Run down houses in Auckland,Happy new year 2015 !!!

[Damap]

Tire kicking investor is your nickname.
All those books were written pre GFC, good luck with most of them now. Your attitude shows you will be very successful and be teaching others before the end of the year.

[Wayne]

I wasn't planning on spending $ 250K, I was looking at spending up to 400k max and are reading up on no money down deals in a couple of books I have got out from the library which is expanding my thinking.

Worked for other peoples so why not for me?

I think the party is coming to an end.
When the shoeshine boy is buying it is time to get out.

I suspect we are just now seeing those who will lose all entering the game.

[Wayne]

See Wayne I warned you.DNFTPT

all work

no play

makes for a dull forum

my thoughts too eri - have to fun some of the time.
Though, maybe I am just being cruel toying with him.

[Damap]

Hey as long as you know then I am all for shooting in barrels :-)

[speights boy]

All those books were written pre GFC, good luck with most of them now.

I suspect we are just now seeing those who will lose all entering the game.

There will always be greedy and silly people in the market.
Every cycle has them.....perhaps depends on them being there.

The transfer of wealth from the over-leveraged to the cash rich.
All part of the game of snakes and ladders.

[Damap]

Agree Speights. Thankfully most of the GRQ strategies have the kybosh by banks and absence of mezz funding these days so they have to try even harder. And get into more trouble :-)

[PTWhatAGreatForum]

It's a sure sign of 'issues' ahead when the paper is full of articles like this:

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11385030

This is not news, it's corporate propaganda. The Real Estate agents are desperately trying to push rents even higher before the Auckland renting public in general realise what a load of crap it all is. They will use any amount of FUD (Fear, Uncertainty, Doubt) to achieve their aim.

The same cynical game is played out all over the country. The difference is - outside of Auckland - the buying market is largely 'meh'. Places go unsold and unrented, all the while the regional papers are publishing front page articles extolling the market went up "18% last month".

When the mass market realises that residential property is a liability, and not productive, the games comes to an end. A few doors down from here is a tidy looking 4 bedroom house for rent for $170 per week. It must be overpriced because it's been vacant awhile. I told the PM it was more than I thought it was worth and she, as expected, disagreed. Of course, she doesn't care much, it's not her place and she isn't incurring costs on it. The buying marketplace is in agreement with my point of view.

This is a small tidy farming area. It's safe, no gangs, people are friendly and the Internet is good. It's very close to a major highway. While I don't expect this lifestyle is for everyone, since I left Auckland 2 years ago I have become quite used to the provinces. There is life out of Auckland and I can't help but think every time I read about rents and traffic there, what a s*show it is up there.

Granted most of the work in my industry is up in Auckland, I don't need to earn anywhere near as much to make ends meet here.

Auckland is an abberation, not indicative of the NZ property market. It is my belief sooner or later it will revert to the norm, prices will crash and a whole lot of greedy people (using borrowed money) will be financially wiped out.

[Wayne]

It's a sure sign of 'issues' ahead when the paper is full of articles like this:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11385030

I agree with you there.
Time will tell how long it takes before the tide goes out and we find out who forgot their togs.

[speights boy]

Time will tell how long it takes before the tide goes out and we find out who forgot their togs.

some will still blame others.....GFC this, GFC that.

[PTILoveYou]

Won't have to wait too long, the end to this current cycle is coming, I can smell it.

[Wayne]

Won't have to wait too long, the end to this current cycle is coming, I can smell it.

I'm sure last year you were saying that there were several more years to run?

[Damap]

[chrisgoh]

A good balance view of NZ economy, good read. Have your own conclusion

Do we really have a rockstar economy?

[Damap]

I think our economy is a lagging indicator. We will keep going till the USA implodes again.

[tire kicking investor]

Had an interesting day looking round at a few places in Auckland but all seemed really
expensive and didn’t get that much in rent, doesn’t match the ideas in the book
I am reading.

Not sure if I will get many in Auckland but will still aim for 1 a month but
may be in a few other cities as well.

Looked at few other cities in the Upper North Island and saw a few I liked
better. Put an offer in on this one today which was exciting. I offered 20%
below rating value (That’s right isn’t it) and they have accepted my offer (is
it always that quick?).

Agent has said that the bank is forcing the sale so I guess that makes sense.
He also told me they paid $ 240,000 for it but that would mean
they have dropped $ 90,000 that just doesn't sound right?

It is a 3 bedroom home with a 1 bedroom flat on a free hold section. I had a
look in the property magazine and it says the median rents are $ 320 (house)
& $ 180 (flat) so does that mean it is under rented? Current tenants have
(family group) been there for 4 years.

It seems to make money? Is my working correct, I have followed what is in one
of the books I am reading on how to calculate it all.

Income

Rent: $ 360 pw

Yearlyincome: $ 18720.00pa

Purchase: $ 150,000

Expenses
Interest * 6.49 (5yrs) $9735.00
Rates $ 1281.17
Management $ 1399.32
Insurance $ 684.00
Maintenance $ 2000.00

TotalCost: $ 15099.49

Profit $3620.51

GrossYield 12.48 %

Let me know if I have stuffed up the figures but otherwise off to the bank
tomorrow and road trip this weekend to check out the property and see if it is
ok before it becomes unconditional.

Hopefully this is the January property down