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Joined: Dec 25, 2001 Posts: 34,400 Location: Poundland
Posted: Fri 7/Oct/05 8:04am Post subject:
Slim wrote:
I firmly believe that property is safe investment
I rent 150 metres from a fault line. And no, that's not just a Wellington thing, I can remember a mockumentary they made when they simulated what would happen to Christchurch if it was hit by an earthquake centred in Hanmer Springs.
I think we're very naive about how "safe" property is from natural disasters/ events. However the same could be said for the financial markets
Slim wrote:
coz I'll put $20 on the fact you don't save $690 a fortnight for the next 25 years.
Joined: May 16, 2003 Posts: 8,474 Location: Coasting
Posted: Fri 7/Oct/05 4:03pm Post subject:
Slim wrote:
I firmly believe that property is safe investment,
Yep, safe as houses.
Slim wrote:
If I was to sell my house today, I'd walk out with about $150k more than I have put in, Including the interest.........so you guys figure it out, I am damn sure I couldn't have saved that sort of $$ in the last 5 years
That's due to the market going mental, the increase you make over the next five years will be pittance compared to the last five.
But the biggest issue with housing is people banking on the value going up. That can only help you in two ways.
1. You sell up and die.
2. You die and your next of kin sell up.
Unless you own more than one house, there's nothing to be made, only rent to be saved and that is debatable.
House values rise together, if you own a $100,000 house now (say in Balclutha) and want a better one it might cost you $50,000 extra.
If your house price doubles then it'll cost you $100,000 extra instead. You aren't winning at all.
Joined: Feb 09, 2004 Posts: 13,750 Location: land of the long white latte
Posted: Fri 7/Oct/05 4:33pm Post subject:
Dougal wrote:
That's due to the market going mental, the increase you make over the next five years will be pittance compared to the last five.
since when did you become minister of finance.
Dougal wrote:
But the biggest issue with housing is people banking on the value going up. That can only help you in two ways.
1. You sell up and die.
2. You die and your next of kin sell up.
Unless you own more than one house, there's nothing to be made, only rent to be saved and that is debatable.
you capitalise on your investment every time you sell it. Unless of course you live in the same house for the next 100 years in balclutha....
you also have an asset base to leverage against for other purchases eg more property...
Joined: Sep 24, 2003 Posts: 1,802 Location: Welly town
Posted: Fri 7/Oct/05 4:39pm Post subject:
Kazmeistyr wrote:
Francis wrote:
Kona_stoner wrote:
every ones in debt these days
The only money I owe is about $500 (originally about $1600, all interest free) on the tools for my apprenticeship. And my savings are much more than that
You manage to save whilst on an apprenticeship You still live with Mum then, I guess
Was until recently
Saving is a lot harder now that I'm flatting and my car is costing money, despite the fact that I don't even drive the gnikcuf thing
Joined: Aug 15, 2003 Posts: 16,717 Location: Opawa
Posted: Fri 7/Oct/05 4:45pm Post subject:
Dougal wrote:
But the biggest issue with housing is people banking on the value going up.
When was there ever a big dip in the price of houses
The way I see it there is more chance of making money out of it if you actually own something, and it gives you the option to use it as equity for business or other investments.
Joined: Oct 01, 2002 Posts: 18,624 Location: North Canterbury
Posted: Fri 7/Oct/05 6:43pm Post subject:
Slim wrote:
When was there ever a big dip in the price of houses
The late 70's. If NZers keep up the mongtal personal borrowing like they are at present, interest rates will be put up to control spending, and we could see this again....
Joined: May 16, 2003 Posts: 8,474 Location: Coasting
Posted: Sat 8/Oct/05 4:56pm Post subject:
james_giant wrote:
you capitalise on your investment every time you sell it. Unless of course you live in the same house for the next 100 years in balclutha....
you also have an asset base to leverage against for other purchases eg more property...
As I said before, increasing property prices just increase the price of going up a level.
i.e. sell a $100,000 house, add 50% to get a nicer house = $150,000
House rises to $200,000, add 50% to get a nicer hous = $300,000.
Unless you own a stack of houses which you're going to sell now and not buy again, you're going backwards into more and more debt.
Your second comment brings us back to the lifetime debt thing.
Many people at present are remortgaging their houses to get money for other things = more debt.
Joined: Jun 20, 2004 Posts: 4,694 Location: Back in the Hood
Posted: Sun 9/Oct/05 7:57am Post subject:
Slim wrote:
Dougal wrote:
But the biggest issue with housing is people banking on the value going up.
When was there ever a big dip in the price of houses
The way I see it there is more chance of making money out of it if you actually own something, and it gives you the option to use it as equity for business or other investments.
Clarster is right, between about 75' and 84' actual prices didn't go down but given the ridiculous inflation at the time (running up to 10%) your $50,000 quarter acre dream had a loss of real value. Scarily enough the external stimli for the slump in the 80's were oil prices, high debt (govt back then) and a cooling economy...
If you are going to buy an investment property watch you Price/earning ratios (and include maintenance), anything below 6% or 7% and you could have problems. We have just got out of the landlording business cause we got made an offer we couldn't refuse. So we're going to lower our debt on our house and get back in to property when the market adjusts. And in Welli there will be an adjustment given the number of investors, static/falling rent, low P/E ratios and rising interest rates...
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You still live with Mum then, I guess 
and my car is costing money, despite the fact that I don't even drive the gnikcuf thing 
