tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Friday, December 6th, 9:36AM

News

rss
Latest Headlines

Budget not driving property investors away

If the Budget was designed to put residential property investors off their stride then it appears to have failed.

Friday, June 11th 2010, 3:52PM 4 Comments

by The Landlord

A survey by property investment website Landlords.co.nz and Mike Pero Mortgages shows that investors are not happy with the changes to tax and depreciation that Finance Minister Bill English unveiled in his Budget last month.

However, only a small proportion of respondents are looking to sell up their properties. Twelve percent of respondent are considering selling their properties and just 1.7% said they are definitely exiting the property investment market.

The large majority of investors will continue to be landlords and 21.4% said they will be buying more property.

The winners out of the Budget are advisers such as accountants.

While depreciation was seen as the biggest change that will have a financial impact on investors, most of them acknowledge that they will need to get advice on their investment structures.

Nearly half of the respondents held their properties in Loss Attributing Qualifying Companies (LAQCs), however the government is change the rules around these structures.

"Depreciation probably featured highly for investors as they could easily calculate what the changes mean to investors in dollar terms," Landlords.co.nz publisher Philip Macalister says.

"However the changes to LAQC rules will possibly have a bigger impact on investors."

Macalister says it is important for investors to understand these changes and make the necessary adjustments before the rules change next year.

Investors have mixed views on where house prices will go in the next six months, however they have a very clear idea about what direction rents will move.

Nearly two thirds of investors (59.6%) said they plan to increase rents in the next six months.

The survey also shows that property investors buy houses for sound, long-term reasons, rather than speculation and quick gains.

The large majority (95.6%) adopt a buy and hold strategy, however they are evenly split over whether they are trying to achieve capital gains or income.

Slightly more (50.8%) are investing for income, while 47.6% are looking for capital gains.

« Momentum building in house market, according to ANZFree Investment Property Showcase Events: Auckland, Wellington and Christchurch »

Special Offers

Comments from our readers

On 12 June 2010 at 11:37 am Bruce Fuller said:
I do not own property for rent myself. I do own lots of Property Trust shares however, which provide me with income to supplement my superannuation. This latest attack on property owners has certainly effected the Trusts. The share prices have plunged and each Trust has warned that dividends will be lower next year. Howeve they are a safer investment than Finance companies! My investment in Property Trusts was not for capital gain on the shares but for the steady income they were providing. The tax cuts promised will not compensate me for the fall and the increase in GST will just be another hit. Sorry National but you have let us savers down.
On 13 June 2010 at 5:20 pm Christopher said:
I guess those who declared that they bought for capital gain are in the majority of those who are affected by the depreciation changes and in their favour are probably being honest about what their intentions were.
In any event, Property magazine, time to get past the whinging.
On 14 June 2010 at 3:07 am President of Property said:
well if you worked for the IRD you now have 47.6% of survey respondents to follow up with the existing CGT rules, sure isn't hard to work out if people purchased for capital gains if they ticked the box... as for us investors looking solely for income - we rock...
On 15 June 2010 at 6:16 pm Jamila said:
Who said you have to sell to realise capital gains? If you know what you are doing you can receive an income from rents as well as from capital gains by getting the bank to release the increased equity as a LOC which gives you a tax free income.
Commenting is closed

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
  • Partners kills its matrix
    “@Backstage, thanks. I agree there is no relationship to CoFI, though, from a service perspective, I have two other providers...”
    2 days ago by JPHale
  • Partners kills its matrix
    “Partners Life has decided to stop using its COM for advisers as it believes the system may breach the CoFI regulations which...”
    3 days ago by Amused
  • Partners kills its matrix
    “Insurance companies should stick to their lane. They are not advisers and even those that employ advisers should not be crossing...”
    3 days ago by Tash
  • [GRTV] The nitty gritty of Smart’s ETFs
    “Advisors should consider all gateways into investment markets including cheaply priced ETFs to provide access to low priced...”
    3 days ago by Pragmatic
  • DRS member or not - client care remains advisers’ responsibility
    “FAPs are members of DRS too. Substitute “adviser” for “FAP” and the story is actually a lot more accurate. If...”
    4 days ago by Aggressively_passive
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 4.94 - - -
AIA - Go Home Loans 7.49 ▼5.79 ▼5.49 ▼5.59
ANZ 7.39 6.39 6.19 6.19
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 5.79 5.59 5.59
ASB Bank 7.39 ▼5.79 ▼5.49 ▼5.59
ASB Better Homes Top Up - - - 1.00
Avanti Finance ▼7.90 - - -
Basecorp Finance ▼8.35 - - -
BNZ - Classic - 5.99 5.69 5.69
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One 7.54 - - -
BNZ - Rapid Repay 7.54 - - -
BNZ - Std 7.44 ▼5.79 ▼5.59 5.69
BNZ - TotalMoney 7.54 - - -
CFML 321 Loans 6.20 - - -
CFML Home Loans 6.45 - - -
CFML Prime Loans 8.25 - - -
CFML Standard Loans 9.20 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 5.69 - -
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Owner Occ 6.95 5.79 5.59 5.69
Co-operative Bank - Standard 6.95 6.29 6.09 6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - ▼5.99 ▼5.89 -
First Credit Union Standard ▼7.69 ▼6.69 ▼6.39 -
Heartland Bank - Online 6.99 ▼5.49 ▼5.39 ▼5.45
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.60 6.65 6.40 -
ICBC 7.49 ▼5.79 ▼5.59 5.59
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 7.25 6.89 6.59 6.49
Kiwibank - Offset 7.25 - - -
Kiwibank Special 7.25 5.99 5.69 5.69
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 7.94 ▼5.75 ▼5.99 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 7.49 6.95 6.29 6.29
SBS Bank Special - 6.15 5.69 5.69
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo 4.94 5.15 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.75 - - -
TSB Bank 8.19 6.49 ▼6.39 ▼6.39
TSB Special 7.39 5.69 ▼5.59 ▼5.59
Unity 7.64 ▼5.79 ▼5.55 -
Unity First Home Buyer special - 5.49 - -
Wairarapa Building Society ▼7.70 ▼5.95 ▼5.75 -
Westpac 7.39 6.39 6.09 6.19
Westpac Choices Everyday 7.49 - - -
Westpac Offset 7.39 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 5.79 5.49 5.59
Median 7.49 5.97 5.75 5.69

Last updated: 6 December 2024 9:11am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com