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Six Of The Best

Talented investors highlighted during the past year share their property journey since we last touched base. As told to Joanna Mathers.

By: Joanna Mathers

1 January 2022

Ilse Wolfe

I have scaled up recently: as an investment coach I need to have a number of purchasing models so I can lead from the front. I am looking at doing my first terrace house development; this is currently at the feasibility stage. This will be on a section of a home I already own in Mangere.

The surveyor I have been working with says we can develop either six terraces, or 16-20 apartments here, but it’s an equation of money and time. I have noticed another development of 10 townhouses along the road, so it’s making me wonder why they chose that option.

Today I settled on a five-unit block in Whangarei. This will be a fresh challenge. I will be using my cashflow hacking strategy for the units, three of which have two bedrooms and two of which have one bedroom. Whangarei has intensified its zoning, which means the quarter acre section can be turned into a triple subdivision. I can add two buildings, create new rooms in the existing units, reroof and repaint these, and remove a carport to create more parking. I will be able to convert the existing one title into individual titles, and will end up with eight or nine buildings. The purchase price on the units was $1.16 million, after the first cashflow hack the value will be around $2.2 million, and once the unit titles have established it will be valued at about $3-$3.5 million.

Jasmeet Singh

In the current market, I think the only way to ensure a decent yield is to develop and hold. The market has changed very rapidly. I think more opportunities will arise come late February, early March, when people start to realise the implications of the removal of interest deductibility on their tax bill.

Most people don’t read or do their research, and a lot of people thought the prices would keep going up. People were making significant capital gains in a really short time, but people who have made offers on property will be finding they can’t settle [due to higher interest rates and regulatory changes] and more properties will come on to the market.

I have bought a number of properties over the past few months, with the aim of development. One of them is in Papakura on a section that is 736m2, and I bought the site next door as well.

This is the first time I have done my own development and I am currently going through the resource consent stage for this. But I am going to wait awhile until I start building, because I think the cost of materials are much too high and believe they will come down.

I have also just gone unconditional on a property in Hamilton; a duplex that I will turn into two separate houses. I need subdivision consent, but I will sell these in 2022 once they have been renovated.

Jeremy Lawson

We have been trying to build on the back of one of our existing properties in Havelock North, but the process is taking ages.

We recently sold a property in Palmerston North to get some of our debt down. Properties in Palmy have doubled in price in recent years; we bought it for $400,000 in 2017 and just sold it to Aucklanders for $800,000. Our fixed term mortgage comes off early in the year, so we are able to get some of our debt down. We can pay off our entire loan with the sale of the Palmy house.

We have also purchased some shares; it’s important to diversify in this market; people who have a lot of debt are likely to get into lots of trouble with the interest rate rises and interest deductibility removal.

Monica Chen

Since we spoke I haven’t bought any new houses, but I am starting the resource consent process for development on some existing properties. I think that too many people are going to be doing terraces, and I feel they will be creating a lot of pressure on infrastructure and there will be a lot of them on the market. So, I am looking at developing some architecturally designed, free-standing houses.

I am talking to my accountant about this at the moment, but I think I will probably do five of these.

As a property manager I get some great insights into what property investors are doing. A lot of people are doing build to rent developments, and a lot of them are selling. People are much less confident of a continuation of value at this level, 20-25% per annum. People are slowing down and pulling back. My first development project will be very interesting, I just need to get the resource consent done first.

Fiona Baker

I am currently in the process of helping our son renovate his first home, I’ve just been painting. We are selling one property in Hastings and putting an offer on one in Havelock North—the worst house in the best street, which tends to be our strategy.

A friendly real estate agent contacted us about it. The property is from the 1960s, so not that old, and it’s in a brilliant location, but in bad condition.

We are lucky that we don’t have debt, so the removal of interest deductibility won’t affect us. But with the changes to privacy laws around what information landlords are allowed to ask for or share, I am having to be very careful about what I say to my husband. But as I have a long list of people who would like to be our tenants, I don’t have to go through the application process when we have a tenancy come up.

There is a big bit of land with a burnt out house in the middle of Hastings that I have been trying to buy for years. The old man who owns it doesn’t want to sell, but I will keep trying. It’s 1,200m2 in the inner city; I’d love to get my hands on it. I would like to develop four townhouses on it, which would look a lot nicer than the burnt house that is on it right now.

Aveen Mitra

I have bought one buy-and-hold house since we spoke, but I am in the process of consolidating my debt. I am actually in the process of helping one of my tenants buy their own house. I am gifting them the money, they are a young couple, and they are great tenants. I have seen them saving up really hard, but the house prices keep climbing and they have been unable to get enough for a deposit.

I talked to them about it and said if they paid off all their other loans, and sold the boat they have (“I asked them if they needed a boat or a house more, and they got my point”). So, they will be settling on a house of the tenth of the month. I may get the money back at some stage, but even if I don’t, it will be a good story.

I am renovating one house that I purchased in Palmerston North for $510,000. I expect to pay around $60,000 or $70,000 for the renovation, then I will be expecting to sell it for around $750,000. I am always looking for opportunities: I remember Graeme Fowler saying that opportunities in property are like radio waves. They are always there, in the background, and those who tune in will be able to find them.

An Auckland real estate agent recently called me to say that a house I purchased for $585,000 in March would sell for $750,000—it’s a total s..thole, but people are so desperate to get there first home that they will pay anything.


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