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  1. #1
    Join Date
    Sep 2003
    Location
    High up above and deep down under
    Posts
    10,915

    Default Tokoroa Property

    Hi Guys

    Was in Tokoroa today tidying up and making some internal improvements before the new tenant moves in when I got talking to the next door neighbour.
    He informed me that he was moving to Auckland soon and is looking at selling his house.

    Basically wants back what he paid for it 4 years ago.

    If interested you can email him at pt3atvalue.net.nz.

    Regards

    ps I am considering it as well.

  2. #2
    Join Date
    Aug 2003
    Posts
    7,608

    Default

    Geez - what's wrong with the property? Or should I be asking what's wrong with the chap? Maybe he thinks a house is like a car - devalues as soon as you buy it and it just keeps getting worse - and when it's time to sell the very best case scenario is getting what you paid for it!

    Sounds like you could negotiate him down! Sad but true!

    (Umm......Marc would say this is definitely a very bitchy commit from me - apologies if it has offended anyone)

    you do have to wonder though - don't you?

    Donna

  3. #3
    Join Date
    Jan 2004
    Posts
    3

    Default

    With the state of the economy in Tokoroa you don't have to wonder too hard Donna. The town's major employer - the mill has recently laid a lot of people off.
    Tokoroa might be the place to invest if you are looking for cashflow, not sure how hard it would be to collect the rent though, but I'd forget capital gain.
    IMHO Tokoroa is one of those places that puts the lie to Dr Cullen's theory that property prices always go up.

  4. #4
    Join Date
    Sep 2003
    Location
    High up above and deep down under
    Posts
    10,915

    Default

    Hi aj

    The mill that was closed before Xmas was CHH's timber mill not the main employer, the pulp mill, when approx 100 jobs were lost.

    The Kinleith Mill is at the moment setting production records, mainly as a result of the upgrading that has been done during the last couple of years.

    The house in question is in a very good rental area of Tokoroa in the Wai area and the guy has a job in Auckland and now wants to move his family there.

    I have no problem collecting the rent. This could be attributed to tenant selection and the area our rentals are in.

    Regards

  5. #5
    Join Date
    Jan 2004
    Posts
    3

    Default

    Hi Muppet

    Thanks for setting me straight on the mill closure. The loss of 100 jobs in a town with a population of only around 14000 must still have a major impact on the economy of the place I guess.

    I certainly agree with you that location and careful tenant selection are paramount in reducing the stress levels for the Landlord.

    I guess my point was that in a small town like Tokoroa cashflow is king and any capital gain can be considered as the icing on the cake.

    Glad to hear that Tokoroa is working for you. I have to ocnfess its been a few years since I was last there.

    Given that Rotorua is not too far away, have you looked at that market at all?

  6. #6
    Join Date
    Sep 2003
    Location
    High up above and deep down under
    Posts
    10,915

    Default

    Hi aj

    Yes, I am browsing that market.
    Will make a move one way or another soon.

    I think most of the guys who lost their jobs have picked up jobs reasonably close to their homes to enable them to stay in the area.

    The rents in Tok range from about $90 to around $160 at the very top end. Much cheaper than living in Auckland IF you can find work.

    I heard at the weekend that Tokoroa is a very social type town-lots of very active clubs etc.

    Regards

  7. #7
    Join Date
    Jan 2004
    Location
    Riwaka
    Posts
    27

    Default

    Hi Muppet,
    Could you pass on some more background info on Tok? I've noticed a few properties on the market with good cashflow returns up there.
    Obviously there will be good and bad areas as in all towns, recomendations on where to avoid, in your opinion, would be appreciated.
    Personally I can't see a reason to avoid an area because it doesn't have potential capital gains, good cash flow is good for me. I'm back onshore in a couple of weeks and plan to go up and have a look see, hence the more background info I can get the better saves the legwork.
    Back to Patrick's house (your neighbour) he's had the place valued and hence his expectations may have gone up.
    Cheers
    Stu

  8. #8
    Join Date
    Aug 2003
    Posts
    7,608

    Default

    I'm going to get Muppet to take me to Tokorua when we (Marc and I) visit him late May 04. Only if you have time Muppet?

    I believe I need some education on the area and Muppet's the man for the job....being a teacher should make the experience all the better.

    Thanks Muppet!


    Cheers,

    Donna

  9. #9
    Join Date
    Feb 2004
    Location
    Welly-town
    Posts
    1,095

    Default

    Obviously there is some risk in Tokoroa at the moment, but I don't have enought info to know how big a risk it is.

    The banks have very strong opinions about Tokoroa and a number of other locations throughout NZ. Talking with my banks lately I found out:

    ASB won't let me use a property worth less than $80k as security for another purchase. They are probably the most conservative when it comes to housing loans, but they are effectively saying "not interested in smaller NZ". Hey, they're profitable and successful so are allowed to make that call. Just glad I found that out before I bought anything under $80k.

    ANZ have some kind of blacklist whereby they won't lend more than 70% against properties in certain areas. There were probably about about 12 - 15 on the list which included Tokoroa, Wanganui East, Kawerau, and others I can't remember.

    Gerrard

  10. #10
    Join Date
    Sep 2003
    Location
    Melbourne
    Posts
    84

    Default

    Hi everyone,

    Tokoroa is a very good town for cashflow, but there are certainly parts of town that should be avoided. My personal view is that a town the size of Tok is not going to disappear, but if you want to buy there you need to know the areas.

    I own in in Tok, I'm have no plans to sell there, but I'm also not planning on buying any more in Tok. I'm also looking at Rotorua, there's a lot more "bad" properties in Rotorua than in Tok. Much of Rotorua has been subdivided (crossleased) and there's many "crap" properties in what are normally OK areas. I was there last week and saw many OK properties which were behind a real "dump". Of course the internet RE photos don't show that !!

    regards,

    Rod.


 

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