buying a foreign property

[tericia]

Hi all seniors and exhaulted members, i like to ask for your kind help on a matter that i am considering.

I want to buy a New Zealand property and i'm considering 2 options:

1) a passive income generating 2 bedroom at wellington (capital), managed by a hotel or

2) a 3 - 4 bedroom residential property at Queenstown (south).

the reason for number 1):
i want a place to go and relax about once every quarter (i'll stay for about 7 - 10 days depending on leave availability) and i thought New Zealand's a nice place. A passive income generating 2 bedroom may not make me money, but it lessens my cost of owning a property that i visit at most 4 - 8 weeks in a year.

the reason for number 2):
if i outright buy a residential property in Queenstown, south of New Zealand, i may not generate income from it, but it's mine ultimately. Eventually i may retire there, or children cannot get in local uni, then they can study at New Zealand.


Based on my research, the restrictions for singaporeans owning a New Zealand property is minimal (no land restrictions or location restrictions). However, there is a problem of floods (but i'm buying either a high floor hotel residence, or a house on top of the hill) and earthquakes.

My question is: can anyone who has invested or bought or studied or stayed in New Zealand for a couple of years share their experience with me? If you don't want to share it publicly, you can PM.

I thank you all in advance for your kind help.

[Laguna]

To share...not from me, but friends

1. Friend #1 : uprooted the entire family, sold his landed property and migrated to NZ, as children could not cop with Chinese here. Came back after 5 years, as finally realise skin colour is different, children have difficulties to adapt. In substance, much poorer after coming back as they no longer can afford to buy back the same property.

2. Friend #2 : rich, mid 40, dun need to work, big investor in NZ, spend half a year there....

Life in NZ is too quiet, short term stay is perhaps ok, but not long term...too many things to miss

If ur children want to study in NZ, plan early...one of the better subjects to study is medicine


BTW, 10 hours flight is no fun

[teddybear]

I would advice to thread with caution on foreign properties. Always buy something you are familiar with. When I say familiar, better go there and stay around for a month or more to see how the place and surroundings is like and how living there is like and what are local Govt's rules & regulations and restrictions etc before committing.

Hi all seniors and exhaulted members, i like to ask for your kind help on a matter that i am considering.

I want to buy a New Zealand property and i'm considering 2 options:

1) a passive income generating 2 bedroom at wellington (capital), managed by a hotel or

2) a 3 - 4 bedroom residential property at Queenstown (south).

the reason for number 1):
i want a place to go and relax about once every quarter (i'll stay for about 7 - 10 days depending on leave availability) and i thought New Zealand's a nice place. A passive income generating 2 bedroom may not make me money, but it lessens my cost of owning a property that i visit at most 4 - 8 weeks in a year.

the reason for number 2):
if i outright buy a residential property in Queenstown, south of New Zealand, i may not generate income from it, but it's mine ultimately. Eventually i may retire there, or children cannot get in local uni, then they can study at New Zealand.


Based on my research, the restrictions for singaporeans owning a New Zealand property is minimal (no land restrictions or location restrictions). However, there is a problem of floods (but i'm buying either a high floor hotel residence, or a house on top of the hill) and earthquakes.

My question is: can anyone who has invested or bought or studied or stayed in New Zealand for a couple of years share their experience with me? If you don't want to share it publicly, you can PM.

I thank you all in advance for your kind help.

[bullman]

Hi all seniors and exhaulted members, i like to ask for your kind help on a matter that i am considering.

I want to buy a New Zealand property and i'm considering 2 options:

1) a passive income generating 2 bedroom at wellington (capital), managed by a hotel or

2) a 3 - 4 bedroom residential property at Queenstown (south).

the reason for number 1):
i want a place to go and relax about once every quarter (i'll stay for about 7 - 10 days depending on leave availability) and i thought New Zealand's a nice place. A passive income generating 2 bedroom may not make me money, but it lessens my cost of owning a property that i visit at most 4 - 8 weeks in a year.

the reason for number 2):
if i outright buy a residential property in Queenstown, south of New Zealand, i may not generate income from it, but it's mine ultimately. Eventually i may retire there, or children cannot get in local uni, then they can study at New Zealand.


Based on my research, the restrictions for singaporeans owning a New Zealand property is minimal (no land restrictions or location restrictions). However, there is a problem of floods (but i'm buying either a high floor hotel residence, or a house on top of the hill) and earthquakes.

My question is: can anyone who has invested or bought or studied or stayed in New Zealand for a couple of years share their experience with me? If you don't want to share it publicly, you can PM.

I thank you all in advance for your kind help.

I have some experience in NZ, and these are my response:

Option 1:
How did you arrive at investing in Wellington? I have avoided that place as vacancy rates are pretty high at certain times to the year. Personally, I prefer Auckland as rental demand is pretty strong. If you buy into prime places like Princess Wharf, a.k.a The sail, the rental yield can be pretty good (7-8%) after deducting all expenses. Over there, you need to rent the ground that the building sits on, known as a ground lease and other expenses like the 8% management fee. Alternatively, you can buy those shoe box units near the universities. Lastly, you can get pretty good deals if you attend their monthly auctions.

Option 2:
Queenstown is a nice place to stay but definitely not all year round. I have a vacation home there as well. The skiiing is great in winter(can stretch up to 5 months), but its quiet the rest of the months. Foodwise, I can only eat that many Ferg Burgers before I start thinking of my Roti Prata. Investment wise, getting a 3 - 4 BR is not a wise choice as its hard to rent out. Most people renting there are not your white collar office going type but more of vacationers, 1-2 BR is good enough for them. Also, a nice 2 BR by the lake will set you back by around 700- 800 k. You are looking at 1 mil up for 3BR.

Surprisingly, its quite easy for Singaporeans to get loan in NZ. They offered me up to 90% for residential and 80% for commercial. But bear in mind that interest is pretty high at 4-5 + %, or even higher. With what you have in mind, I think that you may want to buy one of those apartments run by a hotel chain like Hilton etc. They will offer you 14 - 28 days in a year where you get to stay for "free" in your own unit. Cheers.

[tericia]

i wish to say a big thank you to Laguna, teddybear and bullman.

some answers:

i arrived at wellington because i thought that since it's the capital, it cannot go that far. Also this land lease vs house lease issue is new to me since i don't have experience with this issue in singapore.

yes i would be going to new zealand for a month end year to see how i feel about the place.

another question for bullman:

i saw on nz property websites some of the houses can go as low as US$200000 for 2 bedrooms. Can i enquire are these deals suitable for people like us (as in foreigners, or singaporeans) or are these deals usually lemons at locations far from civilisation and the place may have squatters when i am not there.

Many thanks again to all your kind replies. I really appreciate the time you have taken.

[bullman]

i wish to say a big thank you to Laguna, teddybear and bullman.

some answers:

i arrived at wellington because i thought that since it's the capital, it cannot go that far. Also this land lease vs house lease issue is new to me since i don't have experience with this issue in singapore.

yes i would be going to new zealand for a month end year to see how i feel about the place.

another question for bullman:

i saw on nz property websites some of the houses can go as low as US$200000 for 2 bedrooms. Can i enquire are these deals suitable for people like us (as in foreigners, or singaporeans) or are these deals usually lemons at locations far from civilisation and the place may have squatters when i am not there.

Many thanks again to all your kind replies. I really appreciate the time you have taken.

These cheap and "too good to be true" deals are normally as implied. There are many factors that determine the price, e.g. state and condition of unit, need for major repair to roof, heater etc, high ground lease or even high corp fee(maintenance fee) and others. So the low price may reflect the above mentioned.

Unless you are very familiar with the area, difference in a street could mean buying into a shabby area or upmarket area. Its quite similar to the states in some sense. Usually, I stick to areas that are on the higher end. Even then, there could be huge differences like buying into D9 Orchard area vs Mc Kenzie area.

Also, the tenancy laws over there skew towards the tenants which means that you may difficulties getting rid of ex-tenants/squatters/somebody who happens to stake claim to the unit for long enough. Something similar to Japan in this respect.

IMHO, I suggest that you start small and try buying those shoe-box units near universities. Rental demand is always there, forget about capital gain. You can get an entry level one at 60-70 k and learn from there. Less expensive lesson. Yield can be 5-6 % net depending on how you control your bottom line.

[devilplate]

i bot a COMPLETED ppty in NZ from a developer in 07 as holiday home and yet the developer can declare bankrupt and luckily manage to get bck half of my deposit paid TWO YEARS LATER....nitemare for me....so so troublesome.....holiday home become a NITEMARE

lots of silly paperwork....nid to file GST return...until now i still goto file the silly GST return even though i dun haf any ppty there....wrote email to cancel my acct....NO REPLY AT ALL!

[bullman]

i bot a COMPLETED ppty in NZ from a developer in 07 as holiday home and yet the developer can declare bankrupt and luckily manage to get bck half of my deposit paid TWO YEARS LATER....nitemare for me....so so troublesome.....holiday home become a NITEMARE

lots of silly paperwork....nid to file GST return...until now i still goto file the silly GST return even though i dun haf any ppty there....wrote email to cancel my acct....NO REPLY AT ALL!

Wah. That is actually quite rare to happen in NZ. You are very lucky. Which state and area did you buy into? Was developer reputable?

[devilplate]

Wah. That is actually quite rare to happen in NZ. You are very lucky. Which state and area did you buy into? Was developer reputable?

was quite a big developer wor...sian la....luckily small quantum...2xxk ppty ....one of those hotel suites type....free stay for 21days a year plus 8% guaranteed rental returns for 5yrs soemmore....plus duno wat guaranteed capital protection.....marketing gimmick only ...tat time i xchange rate was ard 1.05-1.1 somemore....

tat plc is one of those resort area.....fronting sea and back facing mountains...so much for a gd view turns out to be a nitemare

[tericia]

These cheap and "too good to be true" deals are normally as implied. There are many factors that determine the price, e.g. state and condition of unit, need for major repair to roof, heater etc, high ground lease or even high corp fee(maintenance fee) and others. So the low price may reflect the above mentioned.

Unless you are very familiar with the area, difference in a street could mean buying into a shabby area or upmarket area. Its quite similar to the states in some sense. Usually, I stick to areas that are on the higher end. Even then, there could be huge differences like buying into D9 Orchard area vs Mc Kenzie area.

Also, the tenancy laws over there skew towards the tenants which means that you may difficulties getting rid of ex-tenants/squatters/somebody who happens to stake claim to the unit for long enough. Something similar to Japan in this respect.

IMHO, I suggest that you start small and try buying those shoe-box units near universities. Rental demand is always there, forget about capital gain. You can get an entry level one at 60-70 k and learn from there. Less expensive lesson. Yield can be 5-6 % net depending on how you control your bottom line.

60-70k is really cheap for a mistake. Actually my dad also had same problems as devil plate so he's also advising me to drop the idea.

But then seriously when I see New Zealand, the place does remind me a lot of Scotland, a place I love. So that's why I'm exploring.

Bullman & devilplate, thank you both for the kind advice.

[devilplate]

60-70k is really cheap for a mistake. Actually my dad also had same problems as devil plate so he's also advising me to drop the idea.

But then seriously when I see New Zealand, the place does remind me a lot of Scotland, a place I love. So that's why I'm exploring.

Bullman & devilplate, thank you both for the kind advice.

NZ is a paradise!! Tats y i decided to get a ppty there last time.... But seriously i feel not worth to get aussie or NZ ppty.... Might as well wait for xchange rate to drop n hold their currency instead to earn high interest

Just visit NZ once a yr on campervan fir 2-3wks gd enuff liao.... No nid to get a holiday home

[bullman]

was quite a big developer wor...sian la....luckily small quantum...2xxk ppty ....one of those hotel suites type....free stay for 21days a year plus 8% guaranteed rental returns for 5yrs soemmore....plus duno wat guaranteed capital protection.....marketing gimmick only ...tat time i xchange rate was ard 1.05-1.1 somemore....

tat plc is one of those resort area.....fronting sea and back facing mountains...so much for a gd view turns out to be a nitemare

Think I roughly know which place. Those capital protection is all crap talk, especially those that choose to launch at posh hotels in SG. When shit flys, the hotel will comment that they are just renting out the venue, no affiliation whatsoever.

I avoid those units, prefer to go down and do leg work. Buy those that are already in operation or those 3br SFH. So far, its been quite profitable but I still prefer SG. Home sweet home. I can only take that much ANG MOH food before getting home crazed.

[tericia]

NZ is a paradise!! Tats y i decided to get a ppty there last time.... But seriously i feel not worth to get aussie or NZ ppty.... Might as well wait for xchange rate to drop n hold their currency instead to earn high interest

Just visit NZ once a yr on campervan fir 2-3wks gd enuff liao.... No nid to get a holiday home

yes, the above is good advice too. maybe i should just rent a good campervan and just bunk there and come home without any strings attached. if not lose 60-70k also quite heartache.