Scoping apartment market

Question from Jack updated on 30th January 2015:

Hi sir, I am Malaysian and my wife is a New Zealand permanent resident. We are thinking of starting property investment in New Zealand. We are looking to invest in an apartment with guaranteed rental income, particularly in an area like Auckland or Canterbury. We need some advice on this. Thanks. Regards, Jack

Our expert Krister Samuel responded:

Hi Jack, welcome to New Zealand! I wish you all the best on your new life here.  Auckland is one of the most livable cities in the world, it has no stamp duty on property acquisition and no capital gains tax on resale. An investor’s paradise!  There is surging interest from local and recent arrivals alike in the benefits of the central city, tower lifestyle so there is no shortage of tenancy demand. I understand your curiosity in investing in a central city location. In Auckland the big occupancy magnets of the universities, CBD and Hospital all provide an abundance of potential tenants. And the appeal of constant income is definitely alluring. However, the rental market (in Auckland especially) is experiencing rising rents and record 52 week occupancy per annum. You may be better to invest in a residential apartment without the restrictions of a long-term lease in place. You will have more control this way and a wider market to sell to when the time arrives to dispose of the property. At present you can safely achieve a 7% net return in central Auckland with a guaranteed return or on the open market. This figure is dropping as more buyers have become interested. So act fast.  I am already working with a large number of buyers from South East Asia who have successfully invested in the central Auckland apartment market so you can feel comfortable that many others like you have taken the plunge. If you are in the city and want a quick, no obligation chat over coffee to discuss in more detail the pros/cons feel free to contact me.

Krister is ranked in the top 1% of all real estate agents nationwide and specialises in the high yielding Auckland apartment market. He is happy to share insights and information on any aspect from an extensive knowledge base built up over a decade.

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