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Who's still buying?

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  • Who's still buying?

    With Auckland residential yields below 4%, commercial yields below 5%, flat capital gains, a market sentiment that rents will decline and interest rates will rise, who out there is actually still buying?

    I notice a very pronounced absence of Propellor property / NZ Invest / <insert investor churn company name here> ads on the radio over the last few months. Is the current strategy simply to hold on tight for the next few years and hope something changes?

    Whenever I look at the numbers, to me it really makes more sense simply putting any money into term deposit - you don't need to worry about your term deposits getting P contamination, and the returns are better

  • #2
    You must not listen to ZB, they are churning away every day on there!
    While interest rates are so low for depositors RE investment companies have a captive market.
    Real investors are in a tougher position but I predict the RB will have to modify their punitive LVR rules soon.

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    • #3
      Why will the RB have to change it? Their LVR requirements are having the exact effect they wanted : limit price growth and slow investors down

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      • #4
        No they aren't really at all. They are making it harder for everybody, including first home buyers and slowing down building of affordable homes. Tightening credit in RE nearly always backfires on govt.

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        • #5
          I think RBNZ thought they were boosting construction but the banks aren't toeing the line. Pretty surprised building costs aren't an election issue.
          Free online Property Investment Course from iFindProperty, a residential investment property agency.

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          • #6
            Also I just bought.
            Free online Property Investment Course from iFindProperty, a residential investment property agency.

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            • #7
              Originally posted by Nick G View Post
              I think RBNZ thought they were boosting construction but the banks aren't toeing the line. Pretty surprised building costs aren't an election issue.
              It's possible that the RBNZ looked at the global economy, saw that the cash flowing around the planet was being cut off by China and America and Britain turning inward.

              And that FOMO was going to make New Zealand first home buyers the last fool in the game.

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              • #8
                Originally posted by Nick G View Post
                Also I just bought.
                I'm interested in what drove your recent purchasing decision - was it a fantastic deal compared to current market prices, anticipation of future price growth, development potential etc?

                As I mentioned earlier, no matter which way I look at the numbers for property investment, right now they don't look like they work. If I'm missing an opportunity, I'd really like to know what it is

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                • #9
                  Development potential to create a high yield, bought it at tender. Maybe if I had waited could have been cheaper, might not have got lending then however :-)
                  Last edited by Nick G; 17-07-2017, 12:24 PM.
                  Free online Property Investment Course from iFindProperty, a residential investment property agency.

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                  • #10
                    Great buying in Auckland right now. Home and incomes sitting on the market, development sites not selling, getting quite exciting!

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                    • #11
                      how about other region? I was looking at Wellington and not many good property out there as compared with late '16 - early '17.

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                      • #12
                        I only follow Auckland. But I believe there are always deals everywhere, all that changes is how easily they can be found.

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                        • #13
                          Hi Learning, what are you looking for? I bought in Welly recently.
                          Free online Property Investment Course from iFindProperty, a residential investment property agency.

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                          • #14
                            Anyone buying property now is insane, market has peaked out months ago, Auckland is just going into a slump phase. Due to the high proportion of $ spent on individual properties this time around the fallout will be very painful for those that get caught.
                            Seen it plenty of times, and always the same.

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                            • #15
                              Originally posted by chook View Post
                              Anyone buying property now is insane, market has peaked out months ago, Auckland is just going into a slump phase. Due to the high proportion of $ spent on individual properties this time around the fallout will be very painful for those that get caught.
                              Seen it plenty of times, and always the same.

                              Perry - chalk up another prediction for review in 6 months and 12 months.

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