Property Investment Information

Hundreds of New Zealanders are offloading their holiday homes and seaside baches - and some are going to desperate measures to sell up.

Estate agents report bargains galore for coastal property investors, with some homes and baches selling below government valuations.

Economic commentators debate the benefit of owning a second home in a holiday hotspot. (more...)

Landlords have developed their own set of rules, barring them from renting dirty places, telling lies or making racist remarks to tenants.

The national landlord membership and lobby group, the Property Investors Federation, has released a guide which it wants members to show to tenants.

Federation vice-president Andrew King said most members were already following the code.

"There's nothing to stop members breaking it. We don't have any powers over them - that's the job of the Tenancy Tribunal and the courts. If we are aware of them not getting things right, then by keeping them as members we have a better chance of stopping them from getting into trouble.

"The code isn't to regulate them, it's to inspire professional and profitable behaviour and keep out of trouble." (more...)

Mortgagee sales are tipped to quadruple in two years, and at least one expert is predicting an Auckland surge much sooner.

Property watchers say many homeowners are struggling as high interest rates, tightening credit, job losses and falling values hit home.

Bernard Hickey, managing editor of interest.co.nz, predicted the number of mortgagee sales would double to quadruple in the next two years. He said property listings on TradeMe and RealEstate.co.nz containing the word "mortgagee" had doubled to almost 400 in the past three months - 0.4 per cent of the total market. (more...)

Building Minister Shane Jones says he is close to getting official advice on a system that could let tenants stay in rented houses when the landlord changes.

He told a seminar in Waitakere yesterday that the new system, which he signalled in March, could allow a tenant to lease a rented home for nine, 15 or 21 years, as in the United States.

The lease would continue even if the property changed hands during the term of the lease. (more...)

By IAN LLEWELLYN
Inland Revenue says it is a myth that investments in housing have a tax advantage over other types of investment.

Revenue Minister Peter Dunne and IRD officials appeared before the finance select committee today and were quizzed about why people had the impression that there was some tax advantage in investments in rental housing.

Deputy Commissioner Robin Oliver was blunt: "The short answer there is none."

Rules about expenses for deducting costs such as interest, upkeep and maintenance, as well as paying tax on income were the same for investments in shares or anything else.

Mr Oliver said the rules were tougher for housing investment than other types.

"In fact under the housing case, the capital gains boundary is brought back a bit. There are tighter rules to what is a capital gain," Mr Oliver said.

Mr Oliver said the concern appeared to be that housing was easier to get and it was easier to get loans from the bank to invest in property.

"The concern is the level of (debt) gearing that is possible in the house market which... is a matter of the willingness of banks to be laid.

Mr English said Finance Minister Michael Cullen and Reserve Bank Governor Alan Bollard had given the impression that one of the problems fueling inflation were favourable tax laws for investment housing.

Officials and Mr Dunne hinted that people seemed more likely to abuse tax rule in housing investments saying it was an area where they picked up greater non-compliance and clawed more tax back.

The budget had allowed for $14.6 million more in spending by the IRD to crack down on housing tax laws.

"Why is there a widespread view that... housing has a tax advantage," Mr English asked.

Mr Dunne replied that it seemed to him the belief was part of the national psyche of home ownership and it had been decided by Government to enforce current tax law and not impose new taxes on housing.

Committee chairman Shane Jones said the clear inference from Dr Bollard that part of his "woes" with housing was due to a vagueness with tax law or the way it was enforced.

"What you have told us today is that it is not true," Mr Jones said.

Mr Dunne said his view was that the IRD had carried out enforcement of tax law vigorously and more resources had been allocated to do even more.

Mr English said there appeared to have been strong political pressure for IRD to appear to do something because Dr Cullen and Dr Bollard had said housing had tax advantages, when in fact it did not.
- NZPA