1. Home
  2.  / Investing In Unique Christchurch

Investing In Unique Christchurch

Mark Honeybone explains how you can buy 20% under value and achieve a 10 per cent yield in the Garden City.

By: Mark Honeybone

1 February 2018

I often have investors asking my assistance with investing in Christchurch. We have many properties in the Garden City and depending on what investors are looking for, we match them with the right opportunity.

In this article, I wanted to focus on the subject of investing in Christchurch, as many of the strategies previously discussed in my columns are possible in this city.

It is a unique market due to the past events and current opportunities with many investors making money there right now. However, you do need to be educated on various factors before investing.

Creating Equity

In a typical market, equity is created by renovating, sub-dividing or adding dwellings.

In the past, I used to smirk at a huge number of new investors demanding opportunities at 20 per cent under value and with eight per cent yields. I had to explain to them the market situation and that it wasn’t possible. Now, however when I get asked the same question, I confidently ask how many they are after and where. The ‘as is’ market in Christchurch has enabled investors from all walks of life to capitalise exponentially.

I’ve witnessed several deals where ‘as is’ properties were purchased by our customers $100,000 - $400,000 under value (usually 15-20% under registered valuation), this is after they have been repaired, renovated and fully insured. When you are surrounded by the right team, anything is possible!

❝ The ‘as is’ market in Christchurch has enabled investors from all walks of life to capitalise exponentially ❞

Creating Cashflow

Serviceability in a tight market is paramount. By relying on positively geared properties in times of need can be the difference between sinking or swimming ahead. But how positive is positive? What we are witnessing in the Christchurch market is the rise of the short-term rental market. Developers around the city are catering for this need with brand new builds located within walking distance to the city and potential 10 per cent-plus yields. For a city that is receiving $30 million into developing its centre, the scenarios where investors are winning now and will win in the future is exciting to watch. This positions investors to be able to keep buying, increasing and enhancing their portfolio with quality stock.

Prepare For Opportunities

We all know the best deals don’t stick around for long. So being prepared to act fast at opportunities when they arise is vital to stay ahead. When I talk about being prepared, it is not just your finance; it’s about understanding the market and the opportunities it beholds. Time and time again I have seen solicitors, mortgage brokers and accountants crash incredibly profitable deals because they don’t understand the vision of their clients and the market.

Surround yourself with a team you trust, who are investors themselves or at least understand property investment and who have a proven track record of success with their clients. In addition to this, you need to know what you want to achieve
in the market. Whether it’s understanding the repair process of an ‘as is’ build, so you can make that unconditional offer, or investing in the short-term rental market to reap those exceptional yields.

Don’t make 2018 the year of ‘what if’. Knowledge and clarity is power.

Property Ventures is a licensed Real Estate Agency that specialises in Investment property throughout New Zealand. They also have the NZ Property podcast/YouTube series where Mark interviews the property experts from around the country helping hundreds of thousands of investors. He can be contacted at [email protected] or 0800 NZPROPERTY (697767) Or watch the Podcast/YouTube video at www.propertyventures.co.nz/podcasts

Related Articles