We know what is squeezing the life out of the rental market

[Wayne]

Presuming that and 20% tax, that would be $68k, after four years.

Can't you get yearly payments on a TD?
Could always put it in a PIE fund.
Personally it is shares for me.
5% to 7% dividend and growth to match inflation at least.

^

and don't forget

the nz gov doesn't guarantee bank deposits

https://www.interest.co.nz/opinion/80951/bernard-hickey-says-quiet-removal-guarantee-kiwibank-savers-should-remind-all-savers

so if the bank holding your $2,000,000 folded

you'd lose quite a bit

but if that $2m had been spent on 4 x $500,000 houses....

But they do guarantee houses?

[eri]

^

When a bunch of digits

Disappear on a screen due to your bank being involved in some mysterious shonky trading in derivatives

That's it, you're left with nothing

Happens all the time

But land remains,

And buildings are insured

[Wayne]

Happens all the time

Happens all the time?
Overstating the risks a bit I think.

[eri]

not trying to convince you

leave the impossible to fools

just trying to help understanding...

dec2014

ANZ has admitted misleading conduct over interest rate swaps

"Some of these people lost their farms, they lost everything,"

https://www.nzherald.co.nz/business/...ectid=11368427

[Davo36]

not trying to convince you

leave the impossible to fools

just trying to help understanding...

dec2014

ANZ has admitted misleading conduct over interest rate swaps

"Some of these people lost their farms, they lost everything,"

https://www.nzherald.co.nz/business/...ectid=11368427

So then having land didn't in fact save them...

[eri]

^

no, but it won't if you gamble it at the casino either

they let the bank use their equity

as security for dodgy banking products

the bank staff decided not to explain to them

2 investment options for $2,000,000

1. buy land, own it outright, manage it yourself

2. give it all to the bank, hope they pay you better than equivalent rent, hope they don't fold, hope you're not the easy, first target of gov tax takes, hope a loooong line of ticket clippers act ethically in YOUR best interests

you pays'ye money + makes'ye choice

i'd rather work in my own interests

than pay someone who said they were workig for me

but had a proven track record of working for themselves on my dime

fools + money....

[Perry]

Can't you get yearly payments on a TD?

Not usually. The final 'dividend' is usually paid at maturity.

[Keys]

Way back in the late 80's payments were made up to 12 times per year. Remember the wage/price freeze Perry? Banks had to make deposits more attractive. They used to credit interest on a daily basis as well. Anything to get around the freeze Muldoon placed upon the country.

[Perry]

I understand that interest credits are (or may be) made monthly, or at an even shorter cycle.

What I have doubts about is that the TD principal and/or the interest become available funds until maturity.

[eri]

TD can be structured pretty much how you like nowadays

You can choose to invest from a range of fixed terms (from 30 days to five years)

For terms of 180 days or more, interest can be either:

• paid into any New Zealand bank account
• monthly,
• quarterly,
• six monthly,
  annually
• or at maturity
• reinvested (compounded)
• quarterly,
• six monthly,
• annually
• or at maturity.

For terms of less than 180 days, interest is paid or compounded at maturity.

BUT

if you want maximum flexibility, say 30 day term, you only get 0.5% interest

https://www.anz.co.nz/auxiliary/rate...term-deposits/
The minimum investment is $10,000.

[Wayne]

What I have doubts about is that the TD principal and/or the interest become available funds until maturity.

Obviously the TD principal can only be paid back on maturity - otherwise you would not be investing anything.

[Perry]

TDs "have their place," but I just don't see them as a viable alternative as suggested.

Not just on the basis of the interest, but having the full house-purchase-price available to invest and taking into account inflation.

As I recall from many contributions to these forums, two prominent objectives in the minds of PIs are:
1) A hedge against inflation;
2) Greater financial flexibility.

But with the horror stories appearing in the media, PI is not without its risks, too.

[Wayne]

TDs "have their place," but I just don't see them as a viable alternative as suggested.

Not just on the basis of the interest, but having the full house-purchase-price available to invest and taking into account inflation.

As I recall from many contributions to these forums, two prominent objectives in the minds of PIs are:
1) A hedge against inflation;
2) Greater financial flexibility.

But with the horror stories appearing in the media, PI is not without its risks, too.

I'd agree re the TDs - the return is still too low to bother with and they don't keep up with inflation.
Which is why I prefer shares.
I'm quite happy with a return of 15% total (dividend and capital) over the last year and 12.4% average for the past 15 years.
For cash it beats houses hands down I think - especially now with increasing costs and such low returns after those costs.

[Perry]

More Claptrap and Twaddle

If property managers can't fix mouldy homes, are they just ripping off renters?
5 July 2018

. . . but we know there are far too many cowboys in the wild west that is the rental market.

Who is "we" and how does "we know?"

Logical fallacy bald assertion by a gutter journo, as usual.

Call to licence, sanction property managers
5 July 2018

Licensing property managers should be a priority for the government, said Kevin Edmunds, of property management firm Quinovic, in Thorndon, Wellington, with sanctions for those who did not meet their obligations. He called for a similar model to that of real estate agents, who are governed by an independent body. There was no barrier to entry for the industry, he said, and no requirement to have any experience. "It's not unusual to see people come into the industry and undercut the established players."

And yet . . .

Research from Consumer NZ earlier this year found tenants who rented through a property management company were more likely to experience problems than those who dealt direct with the owner.

There's more than a few threads and posts hereabouts on wayward PMs attached to REAs, too.

As has been expressed on these forums before, if there's a perceived need to licence PMs and DIY-PM-PIs, then let's licence and sanction tenants, too.

[elguapo]

Licensing property managers should be a priority for the government, said Kevin Edmunds, of property management firm Quinovic, in Thorndon, Wellington

It's almost like Quinovic stands to profit greatly from licencing property managers.