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  1. #1
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    Investment advice please

    My wife and I, kindly request the advice of more senior/experienced members regarding property investment NZ vs Japan.

    OK... so it's decision time.. we are able to invest up to $100,000 NZ cash (a pittance, I know)... on either a substantial deposit on a NZ (Auckland) central city apartment, or buy (outright) a couple cheap apartments in Fukuoka prefecture where we plan to move within a couple years or so...

    Obviously, the Auckland property market is one of the most expensive in the world right now, with average house prices shooting up close to 1 million... it does seem to have come off the boil now and hit a peak... still, most people say it's hugely overvalued and some say there is a bubble looming on the horizon...

    Now, let me give you a general idea/insight into Fukuoka... First and foremost, it's my wife's hometown... Fukuoka Prefecture is located on the north-east part in Kyushu island.. Japan's 6th largest city with a population of around 4 million people (similar to NZ) or 1.5 million (central city of Fukuoka).

    It's a vibrant growing city - one of the few in Japan with a positive population growth - positive confident economy, one of the most livable cities in the world - some call the smaller brother of Tokyo...

    OK... that was the general background/preamble.. now onto the specifics (bear with me guys)... I will link to samples of each investment opportunity - together with expected yields...

    ?????? (?????????)
    ?????? (??????????)

    Affordable Investment Opportunity in Prime Loc... - Realestate.co.nz

    *First 2 links for Fukuoka apartments, very small 30 m2.. around $30,000 NZ each
    returning 15% gross - but let's just be very realistic and say 10% return Net per year.. so we would expect a minimum return of $10,000 NZ per year on our $100,000 investment.

    *Auckland apartment is $249,000 52 m2 - which is currently rented for $530 per week. *fixed tenancy - whatever that means...
    We would deposit $50,000 on that one.. and were thinking of a 15 year mortgage @ 5.5% PA interest (floating).
    Our mortgage weekly payments would be $377 per week + body corp/rates, etc so the rent would just cover the mortgage...

    So, my question to you, is which option is smarter/better? get instant positive cash flow from cash cow apartments in Japan, or utilize our ability to get a mortgage on a bigger property in Auckland and let the tenants pay for the mortgage?

    I apologize for the long ass post, I know my posts are usually of a more light-hearted nature and I should be paying you for your investment advice... We will shout you a meal/drinks in Japan or NZ for your help, I promise...

    Thank you, sincerely in advance from the both of us... Arigatou gozaimasu!!

  2. #2
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    Quote Originally Posted by NZdick1983
    and let the tenants pay for the mortgage?
    Assuming you get tenants. And there are additional costs involved with that. And do not forget that interest rates are low. 5.5% can go up, a lot. Then the rent will not cover your costs. Double, or more? Can you afford that?

    Stick to the smaller, more affordable option. Japan would be my advice.

  3. #3
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    crackerjack101's Avatar
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    Did I dream this or did I actually read that the Japanese population is decreasing quite quickly.

  4. #4
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    Thank you mate... I guess as we intend to live in Japan, we can manage the little properties ourselves (without paying a broker/manager in NZ).. another advantage.

    Hey, CJ.. (hope you are doing well, bro)...

    Yes, I read that today... it's true... but Fukuoka is bucking the trend, it's a growing (relatively youthful) city... bloody awesome place to visit by the way... my favorite spot on earth (of course I am biased)...

  5. #5
    Thailand Expat terry57's Avatar
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    To ask that question on here is not a stable way to gauge the scene or gather useful information.

    How can you get proper advice when no ones know the property scene in either Japan or NZ.

    You would be the best judge of which way to go given you know both places.

    All I would say is make sure you own something by the time you retire, myself would pick NZ simply because this is your home and unfortunately your marriage ain't certain.

    Anything can happen in the future, if you put all your money in Japan and it goes tits up you will end up home maybe with nothing.

    It happens.

    Best bet is have a bet both ways, maybe a gaff in NZ and a Gaff in Nip land.

    You need to get crackin though, the older you get the longer you will be committed to a mortgage and the longer you must work.

  6. #6
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    I think you answered your own question, NZ...FukU, all the way...I mean Fukuoka...Heh...

  7. #7
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    Here it is;

    Japan's population falls for the fourth straight year — to its lowest point since 2000


    Japan's population falls for the fourth straight year ? to its lowest point since 2000 | Asia | News | The Independent

  8. #8
    Thailand Expat terry57's Avatar
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    I suppose if you buy two in the Nippon that could be OK.

    This way at least you'll get one hopefully.

  9. #9
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    Always have a place to stay...Owned outright and not held ransom by any event...

  10. #10
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    This is the last place I would ask for investment advice...Be warned.

  11. #11
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    My advice Dick would be do neither.

    In Japan you will be investing in a depreciating asset. You will never own the land, you will be up for monthly body corporate costs as well as any other local costs stamp duty etc.
    You will be further investing in a currency that is not the currency you earn and live with. This risk alone would deter me.
    There are any wealthy Japanese businessmen who would be scooping up these bargains wholesale were the returns you envisage available and a capital gain was a realistic prospect. You do not reside in Japan therefore are not eligible for loans/tax advantages that are available to Japanese property investors

    In NZ everyman and his dog wishes to own a second house to rent out. The tax advantages in Australia and New Zealand of negative gearing have inflated house prices in both countries. It looks like Australia is about to remove this luxury and I suspect NZ would follow suit. When this happens the housing prices will fall as a result of a glut of properties coming onto the market - this is the intention of the Govt. - Make housing more affordable for 1st time buyers.

    The problem with property investment is that it ties up your money and does not make it readily accessible.

    At your age, you should be on the lookout for fairly unique opportunities and not be stymied with risky, possibly non viable long-term investments.

    You obviously have entrepreneurial skills having had your own skincare business in Thailand.

    I would suggest a small portfolio of shares in today's depressed market as a short- term solution whilst you await something more controllable.

    Shares historically have always outperformed property, you can get your funds out quickly without the exorbitant fees of entering and exiting the property market. A small portfolio of these may be a short solution.

    Just my two cents worth.

  12. #12
    Thailand Expat terry57's Avatar
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    Quote Originally Posted by BaitongBoy View Post

    Always have a place to stay...Owned outright and not held ransom by any event...

    Oh shit yes,

    Once one has a gaff he owns outright life is a giggle.

    One can then go anywhere in the world and if things go tits up one can just go home and watch Telli.

    In ones own country is the best as then one just goes home and gets on the dole whilst receiving free Health care.

    I'd hate to be living in Thailand with no way home.

  13. #13
    Thailand Expat terry57's Avatar
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    ^^

    Well if what he has said about you not being able to own the land in nippon you there fore would be friggin mad to throw your lot in over there eh.

  14. #14
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    Thanks Terry...

    I respect everyone's opinion... there are some bloody clever guys on here...I may be a Dick, but at least I am a humble Dick 55 especially when it comes to investment matters which are not my forte...

    Unlike Thailand, Japan is very open and fair when it comes to foreigners owning land/real estate.. especially when one is married to a Japanese citizen... but even without being married, you can fully own property there (100% in your name) no strings attached.

    If we buy in Japan.. I will own the first gaff (in my name) she will own the other one... if at some stage down the line, either of us got sick of each other, no dramas she has 1 and I have 1...

    *Thanks Iceman, very interesting... I've never considered shares as an investment, as Kiwis we feel compelled to buy property and perhaps brainwashed into thinking that's the only viable option.. I must reiterate, we will reside in Japan (earn there) and it's 100% legal for foreigners to own property in their own name there - if I am wrong.. I swear on my undies I will change my username to gayboy1983

    **Appreciate all advice so far.. Thank you guys, my balls are in your hands lol!
    Last edited by NZdick1983; 27-02-2016 at 06:38 PM.

  15. #15
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    Quote Originally Posted by NZdick1983 View Post

    Unlike Thailand, Japan is very open and fair when it comes to foreigners owning land/real estate.. especially when one is married to a Japanese citizen... but even without being married, you can fully own property there (100% in your name) no strings attached.
    You are correct Dick, foreigners can own land and property in Japan. However as you are intending to invest in "condos" you will have no ownership of the land and will be invested in the condo only!

  16. #16
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    If you plan on $50k deposit on the Auckland apartment, why not also buy a 30K apartment in Japan and still have 20k in reserve? Best of both worlds.
    Spreading the risk/advantage. Don't put all your eggs in one basket.

  17. #17
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    Hey NZdick,
    I met Iceman for the first ime on Tuesday night, and he is the first Teakdoorian I have met. He was traveling to various cities to expand his already successful business. He showed me a few brochures etc.....not to try to be ostentatious, but simply to be transparent and because he had them there in a folder.
    Prior to moving to Oz, 16 years ago he had a very successful group of businesses in the UK.

    I really think his opinion above counts for a lot....he has a track record.

    I myself am a bit of a fathead with money, but would reply with a big negative about the NZ property....you will have to get a mortgage and pay interest on money borrowed. Not good. Best to be debt-free. Otherwise if the already-inflated market goes down, you're up shit creek.

    Quote Originally Posted by Iceman123 View Post
    Shares historically have always outperformed property, you can get your funds out quickly without the exorbitant fees of entering and exiting the property market.
    Exactly. Shares are a liquid asset. Property is not liquid. Just choose your shares very carefully.

  18. #18
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    It takes money to make money.

    Most never get a deposit together - so you're doing well fella

    Don't matter, NZ or Japan, so long as you buy in a good place and at a good price, it will be a good investment and you'll make money ( as well as having somewhere to stay if you need it).

    What I'd suggest is buying close to where you'll be staying. You can make considerable profits by renting the place out for short term lets via websites like airbnb. However, Being able to get to the gaff to pass over keys or to do routine maintenance quickly makes shit much easier.
    First they ignore you, then they laugh at you, then they fight you, then you win.

    And after that, you can go down the pub.

  19. #19
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    Hi LD, yes.. I know mate.. Iceman and I have had differences of opinion in the past, but I'm not silly and I know he is an astute businessman... taking all advice on-board and appreciate all your advice jing jing...

    Thanks Maanaam, hedge my bets - that was my original plan... cheers :-)

    My team (painters/plasterers) were working on this house a few weeks ago owned by this South African bloke.. nice guy... anyway, he told me he owned 10 other houses in the Auckland region, his strategy struck me as strange.. he said he couldn't realistically pay off any of the mortgages on all those houses before he died...

    He went on to say he wasn't even trying to pay them off... just living off the rental surplus over and above all the mortgages... I know he would advise me to deposit on 2 apartments (minimum deposit) long term mortgage... say the mortgage over 20 years on each property was $300 per week... but we got $500 per week for rent on each... so a surplus of $400 per week...

    I get a headache just thinking about it... I'm not that ambitious... don't want to be rich, just have a stable/secure income when we are old.
    Last edited by NZdick1983; 27-02-2016 at 06:56 PM.

  20. #20
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    I don't know as much about the nuts and bolts of property as Iceman... but I do know that now is not a good time to tie your money up in property anywhere.
    The world economy is on the decline and there's nothing left to bail it out this time.
    One of the first things to crash as always is property.. hold on to it and pick up a bargain in 18 months.

    Or has been said, use a bit of lateral thinking and spread your risk/return, or look for the niche payoff like the black swan investors.
    Life should not be a journey to the grave with the intention of arriving safely in a pretty and well preserved body, but rather to skid in broadside in a cloud of smoke, thoroughly used up, totally worn out, and loudly proclaiming "Wow! What a Ride!"

  21. #21
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    Who has the most earthquakes? Just a thought.

  22. #22
    Thailand Expat terry57's Avatar
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    Quote Originally Posted by Latindancer View Post


    Exactly. Shares are a liquid asset. Property is not liquid. Just choose your shares very carefully.



    Well, I personally feel very secure in the fact I own my house in Perth and the rent I'm getting from it is adding to my lifestyle here in Thailand.

    It also gives me security in the form of always having somewhere to live. Its dropped in Value as all real-estate has but I'm unaffected simply because I own it.

    Shares have plummeted like a rock over the last 6 months especially Australian shares.

    Punters who own nothing except their shares are sweating like a large Alsatian watching their money disappear month by month.

    The smart money is on having a balanced portfolio, that being property and a solid Superannuation fund.

    By the way, Australian Superannuation funds have been bleeding money because of the crash in global shares.

    I shifted mine months ago into Cash to stop the bleed.

    When things pick up I'll move it back into the market again.

    One things for sure, you must start thinking about money for your retirement now.

    Don't piss around or will be left behind and trapped working forever.

    Many punters have very little money for their retirement.

  23. #23
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    Earth shakes every night at the Dick's residence

    Last year we were staying at her mum's house, we felt a small earthquake... I ran downstairs freaking out - they all laughed at me, they were completely unperturbed - it's a normal occurrence for them...

    We could die anywhere/anytime, Rick... better to die where you are most happy.

    Thanks Terry... it just goes against my instinct to buy a 'house' in NZ... house prices are insane! it would be just my luck - dropped my savings into a house, then the market goes plop..
    fuck having a million dollar mortgage tied to my balls till we are old and grey...

    ***Grey/gray, not fookin' gay na kaa*** hehe

    That being said, the Auckland apartment market is a totally different animal and still within the realms of normality.
    Last edited by NZdick1983; 27-02-2016 at 07:27 PM.

  24. #24
    Thailand Expat terry57's Avatar
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    ^

    I was in Bali airport when a quake hit.

    I truly fookin shit my pants and was quite alarmed at my fear of being buried under tons of concrete.

    There was now where to run to.

  25. #25
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    Hide under the bed, bro!... always the safest bet innit 55...

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