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  1. #1

    Lightbulb Auckland Apartments - March 2013 - investment advice

    Hi everybody,

    I'm looking for a little advice from somebody/some people that have experience with apartments in Auckland.
    Basically, I want to buy one and am looking for a little guidance if anybody has the time.

    I do understand the general basics of investment and have taken time to learn a lot, but experience is worth a lot more I believe. This might seem like ABC stuff for some of you but it's a big deal for me as it's my first place so I'm not sure on a few things.

    1. The importance of building position for rental. Do people still rent SE corner apartments... Is it a mistake to buy an apartment in a bad building position? From what I've read or heard so far, I don't see an apartment in the CBD as a huge opportunity for capital gain, I'm more focused on the cashflow. If I was to buy in the Federal building in a crap position on the 2nd floor, or H47 looking out at the other buildings decks and all their shit on it out to the west... Am I shooting myself in the foot rental wise? Is it ok if I just buy it cheap because the view is of the brothel across the road? Can I get more rent if there's a brothel across the road?

    2. Off the plans (brand new). There's some people trying to cram a Sugartree apartment down my throat. Are there any general investment strategies for buying brand new off the plans? Has anybody invested in one? Does it seem viable?

    3. Does anybody know of any buildings which I can save time on and never respond to? Such as ones that are leaky/have current management issues/infested with honey badgers. Does anybody know of a list somewhere that will enable me to save time contacting agents to find the building is about as solid as I was that time I woke up next to "cyclops".

    4. Price per sqm? Is that a real thing? Is there a price per sqm that can give me a basic guideline? Cyclops would've make a killing off me if there was back then.

    Anyway, any help would be greatly appreciated.
    If you do have any tips/help for a newbie looking to get into apartments, please let me know I'm willing to learn.

    Regards

  2. #2

    Default

    Bump! have many of the same questions myself, has anyone got the answers?

    Cheers,
    Brad

  3. #3
    Join Date
    Sep 2008
    Posts
    7,575

    Default

    search the forum for apartments and read for a few hours
    have you defeated them?
    your demons

  4. #4

    Default

    This is what I know from my experiences in Auckland apartments.

    The location of the building is more important to the tenant than the location in the building. Low cold sunless apartments seem to rent just as well as high sunny ones, and yet the higher in the building you go the more your bodycorp levy. (due to needing more use of the lift).

    I don't know much about buying off the plans. I guess read your contract very carefully. be wary of what they tell you is the rental expectation.

    Buildings not worth considering are the leasehold ones.

    Buildings that have identified issues and are in the 10 year period of being able to claim compensation are in my opinion the best buys. Buildings built in the late 90s that haven't had any issues identified are (in my opinion) a ticking time bomb. Everything built to the building code of that time lacks air cavities and will eventually get some sort of issue. Older buildings like the Federal building may be a better buy but will they need earthquake strengthening???

    Price per sqm? Well some agents try to tell you something is a great deal because of this. the reality is, if buying for investment all you want is return less expenses. ALWAYS include body corp levies in your equation. They can take 60 to 100 dollars off your rent.

    I bought 7 years ago for return rather than capital gain and (in spite of people saying there is no capital gain) have received both.

    However I feel prices have risen so much that the return is not what it used to be.

    My main tip is to look at as many as you can and talk to the agents about them and their returns. Get agents to sent you copies of the last few years AGMs and any EGMs (Emergency General Meetings). Read them thoroughly.

    I also find it interesting to look at http://www.propbd.co.nz/ to see what recent sales have been at auctions.


 

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