18-06-2012
Prices set to rise further: Newland
Landlords.co.nz
Property prices are likely to rise considerably further in New Zealand's main centres, says property investment specialist Olly Newland.
By Susan Edmunds
He said investors were choosing real estate over other investment vehicles because the low interest rates offered by banks offered little incentive to put money into a savings account, the sharemarket was volatile and finance companies were no longer an option.
“What the point of putting money in the bank where you’re taxed on it, there’s no depreciation…”
He said those investors were putting pressure on property prices and that was likely to continue. “[Property investment] is easy to understand and the banks are lending 70, 80, 90 per cent.”
His statements are backed up by statistics from the Real Estate Institute of New Zealand and BNZ, which reported last week that there had been a strong return of investors to the market.
Newland said there were no other investment vehicles that banks would lend to such an extent on but that would return an income while an investor was holding it.
Newland said that if the Reserve Bank put limits on the amount banks could lend on properties, that would slow investment. But he said until that happened, being a landlord would likely only become more popular.
Young investors in particular, faced with the prospect of a rising pension age, were looking for places to put their money that would provide a long-term income and return.
Source: Landlords.co.nz