Sunday Times Article October 16 2005
3 members of the Auckland Property Investors Association ( APIA) were interviewed by the Sunday Star Times and agreed that despite the pitfalls investing in property was the best decision they ever made.
APIA has over 1000 members who own property worth more than $1.6 billion. It’s members had been investing for an average of 7.5 years and owned an average of 5 properties each with an average value of $300,000 each.
This means each has an average portfolio worth $1.5 million and carry a debt value of 50%.
Their individual net wealth has increased by $300,000 in the last year due to inflation and despite the predictions of lower inflation 88% of APIA members are planning to buy more property in the coming year. The 3 interviewed agreed that generally any market was a good market to buy in but one had to keep a real eye out for a bargain when the market was inflated.
Garth Cutfield started investing at age 25 and quit his day job at 38. Dolf de Roos’s advice was to stick with properties that only returned 10% + yield in the central CBD or locations with scarcity value. He is against negative gearing only for tax relief benefits, the use of ‘property finders’, and paying asking price on this market.
Lee Whiley has owned upwards of 30 properties over 23 years and again looks for good high yields and also in ‘scarcity value’ locations. He says that there have been better times to buy than at present but ‘buying well’ is the key. He states that generally problems with tenants pale compared to the gains on offer.
Megan McCarthy is one of the now 40% of women who are APIA members a figure up 8% from 12 months ago and a continuing trend. Currently with 15 properties Megan and her husband kevi decided in 1991 that they needed to save for retirement. Her tips are ‘start young, treat debt with respect but don’t be afraid of it and be aware of that the magic ingredient of property investment is leverage’. Also be aware of the extra costs of maintaining property as it’s not all passive income.