Where to invest – Auckland, Hamilton, Wellington?

We are well into winter now and seeing all the usual media hype around the property market. We are also seeing some interesting insights into the current property investment market in the numbers that are coming through. You may have seen a recent report from Core Logic stating that 2438 investors bought an investment property in Auckland in April and May this year. 72% of these purchased the investment with a Mortgage.

Right now we consider Auckland is over value compared to historical norms by around 3-10% depending on the suburb. In addition, many of these investments have poor cashflow – requiring the borrower to significantly ‘top-up’ the investment.

Many of our clients are purchasing properties in Hamilton and Wellington because of cashflow and as these markets have only moved 33-49% in the current cycle compared to more than 90% for the Auckland market. Additionally the amount of capital required to purchase a house in Hamilton and Wellington is significantly less than in Auckland (around $450,000 compared to $700,000 in Auckland). These figures alone offer compelling reasons for why astute investors are looking elsewhere to allow for more diversification and return in the current market, while retaining similar (or better) capital growth forecasts.

At Captivate we are always striving to have the best possible investment opportunities in the market at any given time allowing us to deliver results for our clients and potential clients. We research suburbs throughout New Zealand where properties are under value compared to historical norms, there is long term tenant demand, and cashflow is as close to neutral as possible. We have been investing in residential property for more than 25 years, and have helped and continue to help our clients to build their investment property portfolios or take their first step into the investment market.

We are more than happy to catch up to discuss the benefits and negatives of different properties and markets to help you or your clients make a very informed investment decision.