West Auckland. Purchase now or hold off 6 months?

[td91]

I'm looking to purchase an investment property in West Auckland. I've been looking around and my only area options with my numbers making sense at the moment are Bruce McLaren area of Henderson and Ranui. These areas are fine as they're great for rentals and return pretty well weekly.
My thinking is the market seems to be pretty damn rare of the type of property I am looking for, there's a few I like the look of. But I am thinking am I better to purchase now or hold out 6 months to around Summer and hopefully see more properties on the market that I'm looking for at a slightly better price. Or am I crazy for hoping prices might drive down a little in Summer when supply increases a little more? Opinions needed!

[aay]

What's your budget?

[td91]

$480K ideally in a rentable state or very easily fixed up to be rentable. A yard is a bonus but a rarity and a garage would be a real bonus too. But I'm being realistic.

[donthatetheplayer]

An Agent I deal with suggested Massey is worth looking at. As you may know previously I've been buying in New Lynn / Glen Eden / Titirangi / Green Bay areas. I haven't really looked at Massey myself yet so just passing on some he-said, she-said speculation... My budget is higher than yours though.

[Orkibi]

Massey is a good bet, there is a lot of growth going on there.
rents in Glen Eden didn't move much...in the last 2 years! only for 2bed flats.

if you can find a property with 6.5%-7% gross yield (multiple income at 480k) go for it.
or buy one on large section for less and add income.

its hard to buy good buy and holds in this hot market.

[Meehole]

Hibiscus Coast is a rising market. Trust me! Get in now before the prices go higher and there's nothing left in that price range. Better to be strides from the beach than stuck out in the wilderness of the Wests!

[grip]

Hibiscus Coast is a rising market. Trust me! Get in now before the prices go higher and there's nothing left in that price range. Better to be strides from the beach than stuck out in the wilderness of the Wests!

http://www.interest.co.nz/property/7...quotable-value
Waitakere up 17.8% in past year vs HBC 7.9% and yet Waitakere avg value is 657K vs HBC avg value 715K
I pick Waitakere to hit parity with HBC so there's still upside.

West is better than South for FHBs, hence West will continue to go up.
However 7% yield on 480K= $650/wk rent. This is impossible in Massey/Ranui and most of Henderson.

[Orkibi]

However 7% yield on 480K= $650/wk rent. This is impossible in Massey/Ranui and most of Henderson.

its hard now at the top of the market, but it's not so hard if you time you buying right.

[Meehole]

http://www.interest.co.nz/property/7...quotable-value
Waitakere up 17.8% in past year vs HBC 7.9% and yet Waitakere avg value is 657K vs HBC avg value 715K
I pick Waitakere to hit parity with HBC so there's still upside.

West is better than South for FHBs, hence West will continue to go up.
However 7% yield on 480K= $650/wk rent. This is impossible in Massey/Ranui and most of Henderson.

I said HBC was a "rising market" hence its growth would be lower in the past year. Those figures tell me that HBC is definitely the place to invest, Waitakere has done its dash.

[PTILoveYou]

Buy now, don't wait, the market is going full throttle!

Also lending will become harder after 1 Oct, so be sure to buy now!

[Tortoise]

its hard now at the top of the market, but it's not so hard if you time you buying right.

So by 'time your buying right', do you mean wait for a drop in prices? That would mean prices would have to come down compared to rents, leading to better yields. Do you think this kind of price decrease is likely?

I'm asking because I am in the same boat, wanting to by a PPOR in West, but feeling a little like things are teetering, and scared of being locked in a Colossal mortgage when things head south.

[Orkibi]

do you mean wait for a drop in prices?

pricess will sure drop when the market turns but we don't know from what level. If they go up by another 25% in 2 years and then drop by 15% over the next slump you better off buying now.

First, it is not the price drop that I'm after. It's the motivated vendors and slower market where good deals can be achived.

Do you think this kind of price decrease is likely?

NO, Rents growth in Auckland allways been slower and lower then house price, so don't expect pricess to drop to level where yields start making sense like they did up to around the mid 1990s. These days are gone.

if you buying your own home now (PPOR) then your timing is not great... But you will most likely pay more in 18 month time. So buy something you can afforded and perhaps add value to.