investment (apartment) then house?

[PTILoveYou]

Any money making scheme that last the distance, ie not scam, should be treated and run as a business.

[PTILoveYou]

Going back to OP's topic.

A lot of baby boomers bought 2 or 3 rentals on top of their own homes, often all negative cashflow at the start, but in the end, they all have nice retirements.

So property investment doesn't have to be rocket science.

[reepr]

Thanks for all the equities info. I can see a well managed, leveraged portfolio returning 25% would put a smile on your face, and is s good way to spread risk.

Clearly there are many ways to financial freedom, and the lesson should be to do what you understand, interests you, take some informed risks and enjoy the journey.

I do spend many hundreds of hours looking at real estate, but enjoy it so it doesn't feel like work. After purchase I leave everything else to the property manager because I don't enjoy checking on rent payments and organising repairs etc.

I guess the reason I haven't considered shares etc is I don't have an interest or passion for them. Clearly I should be looking harder at them to spread risk.

[SwissKiwi]

Thanks for all the equities info. I can see a well managed, leveraged portfolio returning 25% would put a smile on your face, and is s good way to spread risk.

Clearly there are many ways to financial freedom, and the lesson should be to do what you understand, interests you, take some informed risks and enjoy the journey.

I do spend many hundreds of hours looking at real estate, but enjoy it so it doesn't feel like work. After purchase I leave everything else to the property manager because I don't enjoy checking on rent payments and organising repairs etc.

I guess the reason I haven't considered shares etc is I don't have an interest or passion for them. Clearly I should be looking harder at them to spread risk.

Seems like you are contradicting yourself a little here.

I do this:
'Put all my eggs in one basket - a basket I know inside out - and I don't take my eyes off that basket'

Different strokes of course.

[eri]

interestingly enough

bob dey reports seem to indicate that the auckland apartment market might be cooling

this week seems to have had many "passed in", or "no bids"

on Wednesday 25 September 2013 in Apartments, CBD and fringe, Market, Sectors 0
2 apartments offered at Bayleys’s residential auction today were passed in without a bid on either. A shop in Mt Eden with 2 flats above it, all leased, fared a little better, attracting bidder interest but no sale. In comparison, half the stand-alone homes up for auction sold under the hammer.

http://www.propbd.co.nz/apartments-shop-residences-passed-bayleys/?utm_source=Bob+Dey+Publishing+List&utm_campaign=f10c73ae6e-Bob_Dey_Property_Report_newsletter_Friday_27.9.13&utm_medium=email&utm_term=0_7b04bb0d30-f10c73ae6e-284800325

on Friday 27 September 2013 in Apartments, CBD and fringe, Market, Sectors 0
An apartment requiring remedial work, carrying a declared reserve but passed in at auction $2000 short of that figure, was sold a short time later for the top bid at City Sales yesterday.
All 5 apartments offered at the auction were passed in after only a handful of bids across the whole collection, but another one of them was sold on Thursday.

http://www.propbd.co.nz/5-apartments-passed-city-sales-auction/?utm_source=Bob+Dey+Publishing+List&utm_campaign=f10c73ae6e-Bob_Dey_Property_Report_newsletter_Friday_27.9.13&utm_medium=email&utm_term=0_7b04bb0d30-f10c73ae6e-284800325

wonder if that is;

- bank loan limits kicking in

- a buyer reluctance for 5%? nett returns, when leak risks are so high

- a combination of both?

- or just the vagaries of a limited sample

[reepr]

Seems like you are contradicting yourself a little here.

I do this:
'Put all my eggs in one basket - a basket I know inside out - and I don't take my eyes off that basket'

Different strokes of course.

Not meaning to sound contradictory, just open to all possibilities. I definitely am not so naive to think my way is the best, or only way. There are very few viewpoints and strategies I can't learn something from. I enjoy hearing others point of view, and love a good argument. By that I mean either I change the other guys mind, they change mine, or we respect our opinions differ... all good. ( Of course just hypothetical...I am never wrong )

I like the eggs in one basket quote, that describes my investments well, I just hope like hell someone doesn't want to make an omelette

[SwissKiwi]

wonder if that is;

- bank loan limits kicking in

- a buyer reluctance for 5%? nett returns, when leak risks are so high

- a combination of both?

- or just the vagaries of a limited sample

I would have thought apartments could do well out of the LVR limits - cheaper prices puts them into the new lower target price range of FTBuyers. However banks have higher deposit requirements for apartments - so perhaps this cancels itself out to neutral.

What is the latest situation on public notification of leaky apartments - a while ago there was a thread about public lists of leaky/not leaky buildings.

After hearing even the metropolis has water issues - I find it hard to get interested in any apartment investment.

[speights boy]

Melbourne.

High-rise rush threatening city's liveability

Report authors Bob Birrell and Ernest Healy, of Monash University, said the ''unsustainable'' boom was being driven by foreign investors, not occupiers, and was eroding the positive effects of upgrades to the city's transport infrastructure, public spaces, parks and laneways.

''The apartment boom is squandering this investment … it is delivering tiny, poor-quality apartments,'' they said. ''The city is heading towards becoming a dormitory rather than a centre for knowledge-intensive industries.''

An RMIT planning expert, Michael Buxton, said Melbourne had never before experienced such a ''staggering'' scale of medium and high-rise residential development.

''This is a gold rush with a whole lot of players who are running hell-bent while it lasts,'' he said.

Professor Buxton urged the state government to intervene and make sure the long-term factors underpinning the city's economic success will not be destroyed by the ''rampant desire'' for short-term profit.

highrise-rush-threatening-citys-liveability

[eri]

i'm not aware of any public listing of the leakers

part of that is litigation fear of the definition of leak

metropolis denies that it is a leaker, but accepts that it has water ingress issues???

but their leak levy on a $250K apartment is $5k - 2%

but at 508 queen street this new? leaker has a levy of 2% just for the legal fund

the leak repair levy is $28k - 20% of the CV

and i think there'll be no rent for 6 months to a year while the whole thing is being scaffolded, reclad and repaired

Updated: 508 Queen St, unit 1L:
Features: 28m², one bedroom, deck
Outgoings: rates $736/year including gst; body corp ordinary levy $2146/year, special levy $27,850, special levy for litigation $2229
Income assessment: not given
Outcome: declared reserve of $110,000, passed in at $105,000, sold post-auction for $108,000
Agent: May Ma & Mark Li

[elguapo]

metropolis denies that it is a leaker, but accepts that it has water ingress issues???

but their leak levy on a $250K apartment is $5k - 2%

A Leaker is one where the cladding system/design/installation has failed to perform to a reasonable degree over a minimum service life. Metropolis, from my understanding, does not have this issue, it's more of a larger scale maintenance issue. I don't know if the root cause is design or construction related, or just from poor maintenance, but just because there is water ingress does not make it a 'leaker'.

I've had quite a few problems getting cladding on a house of mine repaired, simply because it seems a lot of contractors just don't want to touch anything to do with cladding because of the 'leaky' stigma.

[speights boy]

But honestly, property is so lazy and easy. Buy well. Wait. Repeat.

Just wanted to add some balance here, not for you reepr, but for others at the start of their investing.

As I have said, property is generally a wise investment.
However, a lot people underestimate or are unaware of the importance of liquidity if things go bad early on.

Liquidity risk, when it doesn't materialise, is often ignored as if it didn't ever exist.
It is always there, and new investors should be aware of it.
As someone's net worth and diversity grows then individual liquidity risks usually will reduce also.

Dogged determination not enough

"I just don't understand why it needs to be so complicated. They just fob you off, and grind you down," Jameson said.
"It's so frustrating. Some of the owners have bought new properties, but their whole life savings are in their apartments".
Abbot said knowing when it would end was guesswork.

Tallying up his lost business, interest on the borrowed money, and "massive" engineering and legal fees, Jameson calculates the earthquakes have cost him $1 million.

"What's tough is that I'm working awfully hard to get the new business together but I have to keep going to the bank for more money.
"It's hundreds of thousands of dollars - I shouldn't have to be paying interest on all that money when I could use my own."

[eri]

a recent comment by city sales, ak's largest? apartment realtors

"What is also rather alarming is the growing number of remedial issues being identified in existing complexes.

The implementation of Long Term Maintenance plans, now a requirement under the Unit Titles Act 2010, means buildings are being subjected to closer examination than ever before."

[absolutereturn]

Although you can leverage equities through the roof, I probably would recommend to keep it modest, maybe around 1.5x. Returns on equity portfolios, especially small cap stocks can be quite high, so there is no need for high leverage on your investment.

[Hec]

Hi Ncinco
If you can afford a house with land now then do that.
Land is where the value with subsequent increases over time is.

[Maccachic]

A Leaker is one where the cladding system/design/installation has failed to perform to a reasonable degree over a minimum service life. Metropolis, from my understanding, does not have this issue, it's more of a larger scale maintenance issue. I don't know if the root cause is design or construction related, or just from poor maintenance, but just because there is water ingress does not make it a 'leaker'.

One would think if there was water ingress then there is a leak/s somewhere. Changing the definition doesn't change the fact - leaky, weathertightness issues, water ingress - expensive solution.