Are Kiwis really obsessed with Property?
Err – no.
But it makes a good headline doesn’t it?
There have been two articles that talk about this recently – both contradict each other – no surprise there – articles usually do that.
In today’s article, it seems that a group of concerned people have addressed a group of concerned politicians (uh oh) and told them that we are about to “lose our sovereignty to Australia” if we don’t stop buying houses. Seriously. And some of these people get paid a lot of money to write such tripe. I mean – how can buying houses possible mean we are about to get taken over by the Aussies – and why the hell would they want to take us over anyway?
Now basically – all this is to do with looking at why the Banks won’t pass on the drops in the official interest rate. I thought it was just because they wanted to screw us for more money – but the boffins think its all the fault of the Property Buyers. So watch out – you might not want to buy your own home and a Bach when you move here – you will be blamed for us becoming an Australian Territory.
Of course – the people they are really blaming is people like me – dastardly, evil, greedy Property Investors – who apparently according to said boffins are “using the credit card to pay the mortgage”. Like hell I am mate! Our mortgages are paid for out of our hard earned salary and a bit of rent. Speak for yourself – don’t speak for me!
So – exactly how many Kiwis own investment properties? Why is there such a rush to insist that the recession is all our fault? That the New Zealand economy is collapsing because every Kiwi owns a gazillion houses and we need to invest in shares (New Zealand shares of course) instead?
That’s right – a whopping 7% of kiwis own rental property, and most of those (about 90%) own just one or two rentals. Leaving about 0.7% (ish) of the Kiwi Population that are “professional investors”.
Scarily – that includes us with our huge portfolio of 3 (yes three) rentals. When we settle on the two off-plan rentals we have purchased – you will have to hang us from the gallows. I had a rather “wow” moment while chatting about insurances with my broker when he said that we had “Lots of rentals”. I don’t think I’ve even got started yet. We are piffling compared to a lot of people I know.
The other article that I thought was actually really good puts this in perspective was looking at words of wisdom from Andrew King and Lisa Dudson, both well respected people in the property world over here.
They talk about the basics of property investing – that funnily enough you do have to do some work, and you do need to look after your tenants and not house them in a flea pit. (While looking at properties to buy – I have seen things that would have the owners in jail if animals had to live in them – but humans get charged rent for the privilege).
Lisa Dudson says “Patience aside, making a profit in property takes sound planning, strategy, wise counsel and firm financial foundations.”
I know I’m only just really starting out with property investing – but that’s pretty much how we do it. We get people to help us, we have a plan, we know what we are looking for and what we want to achieve, and we still keep control of our spending. I can honestly say that it ain’t me that’s overspending on credit! (Well apart from the recent splurge on the 46″ Sony TV and Sound System – but I had saved up for that so even though it went on the card – the bill got paid immediately). My coffee habit is also affordable – so that is not going to cause the immediate take over of New Zealand by the Australians either I’ll have you know!
Whether or not you join the Kiwi Non- Obsession when you get here and invest in property – make it your choice and don’t be bullied by what other people think is right for you, and don’t be bullied into not doing it becuase there are so many people at it and you will be responsible for the end of civilisation as we know it. Get lots of advice and get help – an remember that buying houses in New Zealand is not at straightforward as many people would like you to think, and you need to understand the tax laws.