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  1. #1
    Join Date
    Jun 2005
    Location
    Nelson NZ
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    3,863

    Default Nelson PIA meeting and newsletter

    NELSON PROPERTY INVESTORS ASSOCIATION
    MARCH 08 NEWSLETTER
    PO Box 198 Nelson [email protected]
    Our next meeting is being held at the Suburban Club Tahunanui Drive on THURSDAY 27March. The meeting proper commences at 7.30 pm with the ever popular meal at 6pm when you will have the opportunity to chat to other investors. Jeff Butterworth from QV Valuations Nelson will speak to us on what is happening to our market. Perhaps he might even be bold enough to suggest were we are headed. Also I have asked him to explain the special package of services that are now available to members on QV on line. RSVP Glenn for the meal please (Ph 03 547771 or better still email me.



    THE MARKET



    As some of you might have figured the sale prices are headed down. As usual not everyone is happy or sad about this. From what I have observed not all property is soft and not all types of properties are being given away. One of my clients sold recently and was very pleased with the quick sale price achieved in The Wood. Sure it might have got a little bit more a while back but it was still lots more than paid 6 years ago. They got $30,000 above the current RV. In fact the capital gain was well in excess of the total rent collected over that period. Another client purchased between the colleges and was delighted to get that property $25,000 below the current RV. A recent auction for a good quality central city commercial property indicated that these properties are still selling at historic highs at, dare I suggest, unsustainable rates of return. In my opinion commercial property investors now need well over 50% cash deposit because of the low net rate of return and high interest costs prevailing.
    The demand for residential rentals by tenants has never been so high. This shortage of all classes of properties is driving up rent levels. Rents over $400 per week unheard of not long ago is becoming more common. One-bedroom flats are well sought after also and this is driving their price up towards their $200 barrier. Despite the apparent narrowing gap between holding costs and income most properties are still selling for around 5% gross ROR. When finance is around 10% it is going to take a long time for some investors to start making some money instead of a loss. The market is correcting itself at the moment. Today is one of those historical times that we will look back on in a few years and wonder why we did not do something when the opportunity was there. Something like buy or sell both of which can be the right thing for different people. Without a doubt putting the rent up to market rates is the least you can do.

    FUNNY STORIES FROM GLENN

    Due to popular demand I have been told to create some more stories. These are all true and have happened recently. Some facts have been altered slightly to protect privacy and embellish the stories.
    I am ringing you up about our client a health worker says. We are concerned about the number of men visiting her. You have a duty as a landlord to provide quiet enjoyment the caller says.
    I splutter back.
    But the police and ambulance service keep taking her away. She was caught running around at night near naked annoying the neighbouring tenants. I think you have a health problem to deal with not a tenancy issue.
    Not long after the poor dear was locked up in jail but the tenancy is still in place because the nice folks at
    WINZ keep paying her rent.
    Same block of flats different tenant.
    I demanded a departing tenant remove his non-operating car off the site. He pushed it slowly down the long pot holed drive in the hot summer sun. I came back later only to find it back right outside the flat. What is going on here? I shouted. How dare you bring that heap of scrap back onto the site? Please Glenn he cries. Have pity on me. I needed to load my clothes into the boot and this seemed the best way to do it by bringing the car back to my pile of possessions. So after loading it up he heaved and sweated it all the way back out to the road for the council to come and
    take it away at a later date. (No fine for me this time)




    Disclaimer. Anyone stupid enough to act on advice or comments in this newsletter without thinking for themselves deserves to suffer the consequences.



    NZPIF AGM & Conference 2008 - Rotorua
    Itís Full Steam Ahead for the NZPIF Conference 2008 in Rotorua and registration information is about to go out to the Property Investor Associations. For those that cannot miss a bargain there is going to be,
    Early Bird registrations offer a $100 saving off the full price
    Entry into a draw to win back your registration money in full
    The first 100 people to register will receive a copy of a Bob Jones book.

    Home Affordability.
    There have been various media articles indicating that a home loan affordability index report shows that "an average New Zealand worker on a single income now cannot afford to buy an average house, even with a 20% deposit, in any region in the country". As you may well of picked up in all the media hype, it is the property investors that primarily seem to be being targeted the villains for this.
    On the 21st of February, 2008 you were represented by the New Zealand Property Investors Federation at the Commerce Select Committee with an oral testimony to the inquiry into housing affordability. The NZPIF in its presentation:
    Told the Committee that property investments were taxed the same way as everything else and that buying rental property is the equivalent of having gone into business - the landlord business.
    Disputed the notion that current tax policy and laws treated the buyers of a rental property more favourably that other asset classes and reiterated that property investors were not the cause of housing un-affordability.
    Further disputed that implementing a capital gains tax or changing the deductibility rules would not improve housing affordability but would actually penalise tenants by driving up rents.
    We are getting Hugh Pavletich to speak at one of our meetings later in the year on this subject. He is the
    Co author Ė Demographia International Housing Affordability Survey www.demographia.com
    For further reading on this subject look at www.affordablehouses.org.nz

    PLANNING FOR THE YEAR
    At our annual planning meeting for the year the following meeting dates were fixed. You might like to mark your diaries in order to avoid missing our highly rated speakers.
    27 March
    8 May
    19 June
    7 August
    25 September
    20 November

    The subscription rate was also discussed. These have been set at $170 per annum. This rate is still lower than most other associations. In the package for financial membership you get your annual Veda credit check fee paid for, NZ Property Investor magazine, Capital Property Investor magazine, and
    several nationwide discounts privileges.
    The new invoice for this year is attached.

    Seminars: New LandlordsNelson PIA will be co-presenting with Department of Building & Housing, a seminar for new landlords. Over the course of the presentation, attendees will receive valuable information on establishing, maintaining and ending tenancies. Presenters are from Department of Building and Housing, ANZ or Westpac and Nelson Property Investors Association.
    Venue: Nelson
    7:00 pm - 9:15 pm, 27 May 2008
    Rutherford Hotel
    To Register - Email: [email protected]

    POLITICS AND THE UPCOMING ELECTIONS
    Being election year we are paying a bit more attention on all things political. Some of our speakers will reflect this interest. Keep your eye on the letters to the editor. We cannot let our industry be taxed, levied, and legislated till it hurts.


    This newsletter has been sponsored by SBS. Proud to be a Building Society not a Registered Bank


 

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