I can't see tight finance, tougher tax rules, reduced investor confidence, banned foreign buyers, and a climate of investor bashing and increasingly negative media being a positive environment for property in the next couple of years. Add to this we were at a cyclical peak in 2017 heading into a well-predicted cyclical downturn for Auckland in 2018, with the rest of the country being typically 1-2 years behind the Auckland cycle.
My plan now is to wait for bargains that suit my strategies, and to buy back in when the Auckland market has softened. Remember that bargains in Auckland will always be bargains, so keep an eye out for people dumping quality assets at discounted prices. In a falling/flat market some people sell at big discounts and such situations present investor opportunity. The key is not to pay retail or buy assets you can't add value to, while the market is flattening. As there is unlikely to be growth, you need to generate instant equity when you buy because the growth is likely 5+ years away.I'm sure there will be other pockets of growth around the country, but residential investment property in Auckland is overcooked and must be flat to declining for at least a few years, if not 4-5 years. After that, rents will rise, household incomes will rise, and what is expensive today will become more affordable as incomes catch up to stalled asset values, and we can thereafter see more growth. But it's 5+ years away.
You can see examples of strategies investors are using at present on our free Property Investment & Education seminar. Or learn how to adjust your strategy throughout the property cycle at our 7-week Property School course.
Good morning, Just wished to thank you again for your informative and interesting lesson last night. Whilst I thanked you for your time, I did not compliment you on your clear knowledge and insight into your area of expertise. So compliments! Kind regards, - G F - April 2016
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