Archive for the 'Investments' Category

Property Management Advice from Sabine Slade

My name is Sabine Slade and I live with my husband in Kawerau. I came to New Zealand 26 years ago from Berlin, Germany. We own a number of investment properties throughout the Bay of Plenty which I manage myself.  A couple of years ago, other investors started to approach me about their properties and I now manage investment properties for others as well.

I find that being a Property Manager takes patience and the ability to deal with many different personality types, which is a challenge I thrive on.

Tips on looking for new tenants

I locate tenants through a mixture of advertising in the local papers and online via Trade Me.

Interested parties fill out an application form that includes a privacy waiver clause so that I can conduct full reference and credit checks. Sometimes searching for a new tenant can be an adventure, I have seen people give false details on the application form about their employment, credit rating or where they live. I often will have a browse on the internet as part of the checks for my clients. Social media sites can be helpful as well as the Tenancy Information New Zealand (T.I.N.Z) database.

From time to time smaller towns can have problems with unemployment and gang related issues, so every person who wants to move into a property I manage, has to fill out an application form, thus eliminating the chance that the well dressed, well-spoken and mannered working mother, gets the house and then has her gang affiliated partner moving in with her.  This may sound onerous, however there are usually fewer people looking to rent in smaller towns compared to the larger cities, so a strict vetting process  is much preferable than dealing with a bad tenant later on.

Given the size of the market I do not charge a letting fee, however I ask a full 4 week bond.  Once a tenant is found, the key word for retention is service.

Effective property management practices

When I ask prospective tenants why they are moving, the response many times was that the landlord is “slack”. The tenants had problems such as a stove or power point not working, or a leaking roof, notified the Landlord and nothing happened.   I try to solve any issues within 24 hours either by organizing tradespeople to visit and quote for the bigger jobs or we simply perform repairs ourselves if it is a smaller issue such as a dripping tap. This not only ensures a very positive tenant / landlord relationship but tenants will make more effort to keep the place well looked after. Saving money is good, but not at the expense of your tenants.

However quite often the tenants do not ring me with problems, so regular 3 monthly inspections are important. They keep me in contact with the tenant and also to keep up with any maintenance or repair issues.

I check the rents when they are due. If a payment is missed, I ring or visit the tenant letting them know that the rent was not paid and find out how they plan on catching up.
99% of the time they catch up when the next rent payment is due. If this does not happen I will give them a 14 day letter to remedy which is then followed by an application to the Tenancy Tribunal. In bigger markets property managers are stricter, however it can pay to show some flexibility to an otherwise very good tenant – at least for the first occurrence.

As a rental property owner it certainly helps if you have some sort of cash cushion. More houses means more liabilities and you should be in the position to replace a large ticket item like hot water cylinder or wood burner / heat pump if anything goes wrong. We experienced it ourselves when we wanted to insulate one of our rentals and the company giving the quote found several leaking spots in the roof, which had to be fixed before they would install the insulation. It could not be repaired and we had to re-roof the house at a cost of $12000 when we wanted to only spend $2500 on insulation.

Lastly I want to touch on maintenance. Often it can be tempting for an investors to let maintenance slide, however with a smaller buyer pool that has choice, properties in good condition will be vacant for shorter periods and attract better quality tenants who will stay longer.

April 16 2019 | Investments and Positive Relationships and Property Management and Tenants | No Comments »

Investment advice and tips

You become an investor  once you put your cash into items that could generate revenue or grow in importance. The typical intention would be to earn at the least an after tax return more than inflation’s pace. Becoming a buyer also requires a degree of chance. Typically, the bigger the bigger the risk, the return.

Shares? Securities? Residence? Term deposits?

Ask yourself these questions when choosing what to spend your money on:

Duration: How long are you wanting to speculate for?

Earnings: would you like revenue or growth?

Liquidity: do you want to be able to truly get your money easily?

Risk: understanding your own personal attitude to risk and Understanding the risk involved in different kinds of expenditure.

You can spend ‘specifically’ through a bank (period remains), share broker (stocks and securities), real estate broker (house) or other agents. Should you commit right in stocks, securities or house, you’ll have to be well informed regarding real estate arena or the sharemarket, and also the enterprise.

You can also devote ‘indirectly’ by way of a managed fund. In a managed account (or device trust), your money is pooled with that of additional shareholders, plus a professional fund manager invests it in a variety of purchases for you.

 

Top tips for investing

Before you step into any investment decision, there are some significant guidelines you must follow:

Set:

Determine what it’s that you will be currently looking to obtain. Where do wish to be at some time in the foreseeable future? What is the last consequence that you want from your investments and what is your schedule? Think of debt – is investing the best alternative for you today? Could you be better off using your cash to pay off high -interest debt (e.g. Charge card, hire purchase), or even to reduce your mortgage?

Recognize your chance report:

You need to know what kind of buyer you’re – essentially, how much cash are you prepared to lose? Just how much volatility (good and the bad) are you able to accept? To work your entrepreneur variety out, use our investment manager.

Discover how you want to devote your money:

What mix of investments fits your buyer kind? Ties, shares, property, bank remains? Do you want to invest right oneself or employ managed finances? Your investment planner can help here.
Research different companies’ expense alternatives: discover which corporations fit your kind, if you’re going to commit immediately in a business. Do they offer the type of assets you are after? What are return for every investment’s premiums? What’s the level of danger linked to the return?
Research the companies themselves: exactly what does the business do? What areas is the firm in? Who’s working the organization? Have they actually been declared bankrupt? How may be the organization work? Does the board have separate owners? Has got the corporation done recently – is there a constant performance with time?

Obtain the correct assistance:

Check around for an Authorised Financial Adviser (AFA) who you have confidence in. Sanctioned Financial Consultants should tell you (in a written disclosure statement) how they are settled and also the impact that could have about the advice they provide you with. Find about receiving investment advice more out.

Do your preparation:

Research, compare anything – or get someone to do this for you. See the enterprise parts of the paper, get online, speak to bank boss, your advisor, or accountant. We suggest in addition you read any files, such as /or prospectus and the expense statement, referring to the investment you’re currently considering.

Distribute your chance:

Don’t placed all your eggs in a single basket Whilst The saying goes. Distribute your risk around various companies and different options. For example, if you should be contemplating high-risk ventures, you are able to balance your threat with different investments in income and securities bank deposits or lower-risk regions.

 

 

April 16 2019 | Generating Income and Investments | No Comments »

Why You Need to Invest For Your future

That it is fairly easy: trading means placing your cash to meet your needs. Basically, it is a diverse method about steps to make money to think. Rising up, the majority of US were trained as you are able to make a living just by operating and obtaining a work. And that is precisely what the majority of US do. There is one large issue with this specific: you’ve to work hours if you like more income. Nevertheless, is a restriction to many hours each day we are able to function, and of course the truth that having a lot of cash isn’t any enjoyment if we-don’t possess the free time to savor it

There are about investing lots of various ways you are able to go. Including placing cash into shares, ties, mutual funds, or property (among a number of other issues), or beginning your personal company. Occasionally folks refer as “investment cars,” that will be yet another method of stating “a method to commit to these choices.” These vehicles each have advantages and disadvantages, which I will examine in a portion of this guide. The purpose is the fact that it generally does not matter which technique for trading your cash you select, the target should be to place your money therefore it makes you one more revenue to function. It is the most significant notion for you really to comprehend despite the fact that this can be a basic concept.

You-can’t produce a copy of you to ultimately raise your working-time, therefore alternatively, you have to deliver an expansion of oneself – your cash – to function. This way, when you are studying the document, and sometimes even cutting your garden, resting, investing in hours for the company or interacting with buddies, you may also be generating revenue elsewhere. Basically, for you enhances your earning potential whether you obtain a producing your cash work, choose to perform overtime or locate a greater -paying work.

Why Bother Trading?

Clearly, everyone needs more income. It is fairly clear to see simply because they wish to improve their individual independence that individuals commit, feeling of capability and protection to pay the issues they need in existence.

Whether you reside within the developed Developed world within the U.S., Europe, or virtually every other nation, authorities are securing their devices. Nearly without exclusion, of planning pension, the duty is moving from their state. There’s much discussion over how secure our old age pension applications is likely to be within the next 50 and 20, 30 years. But why leave opportunity with it? You are able to guarantee monetary balance through your pension by preparing in advance. (For more, observe Retirement Planning tutorial as well as for Canadians the Authorized Retirement Savings Program (RRSP) guide.)

Nevertheless, trading has become more of the requirement. The times when everybody then retired to some nice pension and worked exactly the same work for 30 years are eliminated. For people that are typical, trading isn’t much a device whilst the means that is only they continue maintaining and can retire their lifestyle that is existing.

Just why you need to do it and since you’ve a broad concept of what trading is, it is time for you to find out about investing enables you to take advantage of the wonders of arithmetic of one interest.

What Investing IsN’t

Accurate trading does not occur without some motion in your component. Their cash doesn’t merely toss at any arbitrary expense; he/she works comprehensive evaluation and commits money only if is an acceptable expectation of revenue. Yes, there is still danger, and you will find no guarantees, but trading is not less than merely wishing Lady Luck is in your corner.

Trading isn’t gaming. By betting on an unclear result with the expectation that you could get cash gaming is placing money in danger. Area of the dilemma between gaming and trading, nevertheless, will come in the method investment vehicles are used by many people. For instance, it may be suggested that purchasing a stock-based on the “hot idea” you noticed in the water-cooler is as putting a guess in a casino basically the same.

Albert Einstein called interest ” all time’s best numerical breakthrough “. believe this really is accurate partially because, unlike calculus or the trigonometry you analyzed in senior school, compounding could be put on everyday life.

The question of compounding (often termed “element interest”) changes your working cash right into a condition-of-the-artwork, extremely effective revenue-generating device. Compounding may be the procedure for earnings on the reinvested profits of an asset. To function, it takes a couple of things: the reinvestment of period and profits. The additional time you provide your opportunities, the more you’re ready to increase one’s unique expense, which requires the stress from your revenue potential.

To show, let us take a look at a good example:

Since you reinvested that $600, it works together the initial expense, making $636, that will be $36 significantly more than the prior year to you. This tiny bit extra might seem like nuts today, but let us not overlook that you simply did not need to raise a hand to generate that. Moreover, this also offers the ability to generate interest. Following the next year, your expense is likely to be worth $11,910.16 ($11,236 x 1.06). This time around you gained $674.16, that will be $74.16 more curiosity compared to first-year. This escalation in the total amount created every year is currently compounding for action: attention generating attention on curiosity and so forth. This can proceed so long as you keep making and reinvesting attention.

Should you commit $10,000 nowadays at 6%, you’ll have $10,600 in one single year ($10,000 x 1.06). Now let’s imagine that in the place of withdraw the $600 acquired from curiosity, you maintain it inside for another year. Should you proceed to generate exactly the same price of 6%, your expense may develop to $11,236.00 ($10,600 x 1.06) from the end-of the 2nd year.

Starting Early

Consider two people, I will identify Mike and them Pam. Both Mike and Pam would be the same-age. She spent $ 15 while Pam was 25. For ease, let’s hypothetically say the rate of interest was compounded.

Mike, Pam’s buddy, didn’t begin till he reached age 35 trading. In those days, he spent 000 in the same rate of interest of 5.5% compounded, $15. From the period Mike reaches age 50, he’ll have $33,487.15 ($15,000 x [1.055^15]) in his banking account.

Publisher’s Note: for the time being, I shall need to request you to trust these measurements are appropriate. Within this guide we focus on compounding’s outcomes as opposed to the arithmetic behind it. (should you’d prefer to find out more about the way the figures function, notice Knowledge The Full Time Value Of Cash.)

What happened? Pam gained an overall total of $ 42 and Mike gained just $ 18 giving her expense additional time to develop.

March 27 2019 | Generating Income and Investments | No Comments »

What is Real Estate and Property Development

A lot of people familiar with the real estate market and industry are very well familiar with the term “real estate and property development,” and perhaps can even name a few famous estate and property developers. It would appear that the term itself is very easy to understand, a real estate and property developer simply develops or improves real estate.

In reality, the whole concept of real estate development is of course way more complicated than that. Unlike somebody that purchases a home to fix it up and then resell it, a high-end or large-scale real estate and property developer often deals in millions or perhaps billions of dollars in investment. It is true that a developer may be an individual, but then more likely will be a partnership, Limited Liability Company, or even a corporation.

There are two main categories of real estate and property development activity: land development and building development (otherwise known as project development). Property developers usually purchase land that is unimproved, meaning that it is yet to have connections, roads, any kind of grading, and so forth.

Real estate and property developers then step in and define the “contracts,” which are the context of any future builds and developments on the land. They also gain “entitlements,” which are the legal permissions or permits to go ahead with their development plans. Once these entitlements and contracts are in place, the development of the land can then begin, with the grading of the earth, land leveling, utility connections, and then zoning. Also, roads are planned, built, and paved, whether for the major cities or just the neighborhoods.

As soon as the land is properly developed, the building developers may now step in. These building developers then have buildings, whether offices, private or retail homes, planned and built on the land. The building developers and the land developers obviously need to work very closely, as the building developers plans will have to be accommodated by the land developers.  For instance, the utilities brought in for an office building are obviously different from those for a private home, as are the roads, and everything else.

Some of the real estate and property developers also purchase existing properties or buildings for the purpose of upgrading, rebuilding and remodeling, or otherwise improving whether for sale or to keep them as assets to produce cash flow through rents and other means.

What seems to you like the worst time to get into real estate and property development can, in reality, be the best time. Successful real estate and property developers today realize they can use the time to their advantage. Their real estate and property development projects will normally not be ready for rent or sale for 2 to 4 years from inception. So if they have actually bought well, they are more unlikely to be affected by the economic situation at that time of purchasing their real estate development site.

March 27 2019 | Investments and Property Development | No Comments »

Real Estate and Property Development Risks

Real estate and property development risks and their control is the major priority of professional developers, or maybe they never get to get involved in another development. I am continually amazed to find that the first thing most developers do is buy some land or property with some of their own cash and borrow the majority from the bank.

New developers getting control of the property seems logical, and yet it is the last thing a professional does. So starting a real estate and property development by doing the complete opposite to what you ought to do is putting yourself behind the eight ball from the day one and send the ‘risk’ indicator rising.

From a good point of view, a land is only worth what you can utilize it for, and that is determined by the Town Plan of your City and the particular zone applied to the area you are considering. For instance, if you were to buy a land that is zoned Rural and you want to develop some residential houses or townhouses, you won’t be able to do so.

If you purchased some industrial land and your plan was to develop some shopping on it, you won’t be allowed to do so by the Town Plan. Professional real estate and property developers learn the Town Plan, and also all the regulations that control the development activities in certain regions that are of interest to them.

Real estate and property developers don’t pay the lender of development finance every month out of their pocket. The interest is calculated on a monthly basis on the amount which a developer draws down from the lender. The interest is then added to the payback amount required at the end of the development. So by not being educated in the real estate and property development, a new developer is committing to a land without knowing exactly what can be developed on it and then purchases it with the wrong finance package. Putting yourself behind the eight ball twice at the very start of a development process is a terrible way to begin your development life.

Another real estate and property development risks to consider are market knowledge and the lack of a development system blueprint. Looking at the market knowledge, a lot of new developers don’t appreciate that they are actually a manufacturer. For instance, when you buy any product in a shop, it must have many features for it to be purchased and successful. It must be valued right for its target audience; it must be of great value, and it must do the job it is intended for; it has to be designed, and it has to be researched before being designed and many other sub items which make up the profile of any product.

March 26 2019 | Investments and Property Development | No Comments »

How to Invest in Property With Confidence

Investing in property is one of the largest investments you will ever make, which is why you want to ensure that you make a good choice. You need to know that your money is being spent wisely. You wouldn’t want to invest hundreds of thousands of dollars in a property that sits unoccupied and drains money. Here are some steps to ensure you invest in property with confidence.

Consider the Neighborhood

Whether you stand to make money from your rental property or not depends on the quality of the neighborhood. A property in a bad neighborhood is unlikely to be rented out. If you aren’t working with a broker and aren’t able to actually visit the neighborhood yourself, then do a little bit of online research to find out more about the area. You may find that a neighborhood that leaves a bad first impression is a great choice, especially if the area is improving. Good tenants are not attracted to properties in declining neighborhoods, and they may even be vandalized. Consider the crime statistics for the neighborhood, as well as the condition of the neighborhood itself.

Are there Any Attractions, Schools, and Employers Nearby?

Thinking about this question and answering it will give you a good idea of what occupation your future tenants will have and the kind of lifestyle you can expect them to live. If the area has some high-paying employers, you may be able to get more rent for your property. The same applies if there are good schools in the area. Attractions such as shops and recreational activities also make a home more desirable to potential tenants.

Environmental Factors

If you’re investing in property in an area that’s known for flooding and other kinds of disasters, then you’re going to have trouble renting it out. If all of your money is spent on repairing the property damage, then you don’t have a profitable rental property.

Think about the Condition of the Property

You might choose a property that needs a little work done to it. If you do this, then you should be prepared for a vacancy period until the property has been fixed up and is ready to be rented out. Keep in mind different kinds of properties in different areas attract tenants that may have their own definition of what being “rent ready” means. Some properties that are in otherwise good condition might need to be updated to be profitable for the area they are in.

Consider Property Taxes

Don’t forget to take a look at the property taxes in the area, including if they are on the rise. If they are rising, this could quickly become a financial burden. This is an important and often overlooked step.

Summary

Don’t forget that the best way to keep your rental property protected and profitable is through high quality property management. Consider getting a great property manager with plenty of expertise in the business. Carefully consider the above factors when choosing a property and invest in confidence knowing you’re choosing a great property in a great neighborhood.

 

January 06 2019 | Investments | No Comments »

How to Choose a Property Manager

Choosing a property manager is an important process because you are trusting someone else to take care of what may be the largest investment you’ll ever make. That’s why you need be confident that they can handle the job properly. Of course, they must be dependable and trustworthy. Here are some other things to consider to help you understand how to choose a property manager.

Communication
With all the people involved, such as the owner, the tenants, and the manager, communication is key. Some owners like to receive regular updates while others are happy with a select few. No matter how much communication you desire, it’s important you get high-quality communication. Your property manager needs to be available and respond readily. Think about their speed, courtesy, and availability as soon as you make the first contact with a potential manager.

Residents
The property manager has two key duties as far as renters are concerned; finding high-quality residents and ensuring they are treated well. A happy renter will stay around for longer and be more reasonable if something goes wrong. Whereas bad tenants are some of the most expensive mistakes you can make. It can be costly to evict someone, especially if you have to miss out on a lot of rent, and it can also be expensive to repair and clean up the damage left behind. The property manager must be willing to perform background checks on tenants and choose good ones.

Fees
Property management fees are generally fairly standard – typically coming in at between 7 and 15% of a months’ rent. 10% is considered the standard. Sometimes you could be paying less for a condo than a house because the home and yard are smaller. The owner is the one footing the bill for maintenance costs and often has to pay a finder or leasing fee, which could be worth a full month of rent when new residents move in. Find out if you’re going to be charged, even in the event the unit is empty. Some managers will sometimes charge additional fees, so find out how much you can expect to be paying before hiring a property manager.

House Visits
Your property manager should be proactive about inspecting your property, inspecting it at least once or twice a year to ensure everything runs smoothly. These are time-consuming tasks so a property manager needs to have a reasonable caseload. Hiring one that is managing too many properties removes the personal touch. Find one that has the time to give your property the attention it needs.

Earning Potential
Property managers need to get the absolute most out of your property. This involves properly marketing the unit to reduce vacancies. This can involve posting the property on rental websites and taking great photos to show it off. Property managers must also keep up with market rent rates and adjust rents accordingly. You wouldn’t want to be charging too little and not earning what you should for the property.

October 08 2017 | Investments and Property Management | No Comments »