Who’s To Blame For The Rising Cost Of Property?

Olly Newland’s column May 2012

Almost on a daily basis websites are full of angry people accusing ‘speculators’ of ramping up the price of property — supposedly pushing it out of reach for ‘the poor’ and first home buyers.

'The Tax Gatherer' 1540 - Marinus Van Reymerswaele (click to enlarge)

‘Bring in a Capital Gains Tax!’ is the cry, or there are calls to ‘restrict’ lending for property purchases, or to ‘punish’ investors by removing tax advantages, or to flood the market with more undeveloped land. Some even want the government to tax gains that have not even been realised.

This cacophony of shrill envy aimed towards property investors is almost exclusively driven by those who cannot comprehend this market reality: where someone has actually taken the plunge, bought a property of some kind and then — whether immediately or over time — made a profit.

However let me tell you that it’s not ‘speculators’ who are driving up the price of property. Indeed, they are more likely driving *down* the price of property! For speculators can only really thrive by fierce haggling in order to buy at bargain prices.

Read the rest of Olly’s column at www.OllyNewland.com

 

Olly is one of the contributors to Commercial Real Estate Investors Guide — Making money as a commercial property investor in New Zealand — available here.

Commercial Property — The alternative to residential

Olly Newland’s column April 2012

I have always been surprised by how some people react when I suggest they should investigate commercial property investment because it provides a very a good alternative to residential investment.

It’s “too complicated”, they say. Or “too hard to understand” is another common response, as well as fear of vacancies with a consequent loss of income.

Yes, I agree, residential property is the more “liquid” of the two forms of investment, but successful residential investment is, in my view, the hardest subject to master by a country mile.

We all know the advantages of residential property and they are persuasive, that has to be said, but let me give you some of the disadvantages — just for the sake of the argument.

The main problem with residential is that it’s “political” in every sense of the word. From one day to the next there is a steady drum beat, criticising those who own or invest in residential property.

The media run one story after another on overcrowding, shortage of rentals, rising rents, unfair profits, and lately pressure  to introduce a capital gains tax or reduce so-called ‘tax rorts’.

It’s no wonder that there is a growing rental crisis, and increasing homelessness, all aided and abetted by the recent tax disadvantages which have, as expected, had the exact opposite effect from what was intended.

All this was predicted by me for over a year or more. And let me quietly tell you something else in the strictest confidence mind  you. Draw close, I don’t want to shout. …

Read the rest of Olly’s column at www.OllyNewland.com

 

Olly is one of the contributors to Commercial Real Estate Investors Guide — Making money as a commercial property investor in New Zealand — available here.

Olly Newland in NZ Property Investor mag

Olly features in the March 2012 edition of NZ Property Investor magazine

Investor, best-selling author and Authorised Financial Advisor Olly Newland features in the latest edition of NZ Property Investor Magazine.

The article ‘Real Estate’s Rascal Looks Ahead‘ (a play on Olly’s book The Rascal’s Guide to Real Estate) is well worth a read.

Olly has a scan of the article over on his website available as a PDF.

The Mood of the Market: 2012

Olly Newland’s column February 2012

Pressure building in the housing market means ...

2011 has come and gone — and for many it’s good riddance. It was a particularly tough year for some. The recession, both local and overseas, seemed to have no end.

Hopefully 2012 will be better for those of us who are investors, or who intend to be investors.

We are still battling the ding-a-lings lenders who don’t seem to have a clue about what they are doing most of the time. Even worse, we are obliged to endure the stolid hierarchy of bureaucrats at Council level, some of whom should be whipped across the soles of their bare feet until common sense penetrates.

I am proud to say that my team and I have advised and mentored many investors — guiding them along more profitable paths, ironing out problems, re-organising their financial affairs, (whether property related or in general) and sadly, sometimes acting as grief counsellors in difficult situations. …

Read the rest of Olly’s column at www.OllyNewland.com

 

Is another Boom around the corner? Even with the GFC?

Read Olly Newland's latest column — www.OllyNewland.co.nz (click)

Olly Newland makes the case for another property boom — and issues some warnings for those thinking of ‘jumpin’ on in’.
Read his column here at www.OllyNewland.co.nz

Olly Newland’s controversial new column – interview

Olly’s controversial October column is available now.

I say ‘controversial’ because by golly, Olly has come under fire from some of the anti-property, alarmist ‘Oh-My-God-the-world-will-never-be-the-same’ brigade.

As you’ll see from the title of the column While Mortgage Rates Are Low – Borrow More!, Olly is offering an alternative view to the current ‘crowd wisdom’ of reduce debt reduce debt reduce debt. If you read the column (link below) you’ll see that he’s NOT saying gear up for consumption or to buy flash new toys. Nor is he suggesting anything radical or revolutionary. As an Authorised Financial Advisor, property mentor and consultant he’s offering strategies and tactics for today’s investment conditions.

If there’s one thing Olly has proven, it’s that he’s willing to be a counter cyclical investor. That way lies success.

It hasn’t always been a bed of roses for Olly (Read Lost Property), but Olly is an investor who typifies what Warren Buffett refers to when he talked about ‘being fearful when others are greedy and greedy when others are fearful’.

He’s also demonstrated by his own example the value of leaving the party before the clock strikes midnight. His book ‘The Day the Bubble Bursts’ which warned of the (then) impending property slump, was greeted with similar howls of protest. Until later, when several of his most vocal critics quietly admitted they wished they’d followed his advice … to shed lower quality properties in below average areas, do your best to lock in tenants and, paradoxically, to reduce debt … when many ‘gurus’ were saying the opposite.

But that was then and this is NOW. The market has changed and the strategies to succeed in it at this point are different — the strategies, but not the principles.

Read Olly’s October column with his calls to invest (carefully, prudently) NOW … then, if you’re interested, here’s a follow up five minute audio interview recorded with Olly about some of the points he raised, and (briefly) responding to people he says are ‘hyping up’ fears.

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

or download an MP3 file here (5 minutes 2.5MB):
Olly Newland – Why borrowing sensibly for improvements is better than paying off your mortgage

© 2011 Empower Leaders Publishing Ltd. All rights reserved.

Newland: While Mortgage Rates Are Low – Borrow More!

Olly Newland’s column October 2011

This may seem a little contrary to popular thinking at present but by being counter cyclical you will have a greater chance of profit and wealth creation than when interest rates are high.

A few weeks ago I spoke to a group about investment. I spoke mostly about seizing opportunities when they arise and, with my usual arm-waving, talked about how the volatility in the market is a great chance for all investors and home owners. I probably got a little carried away (as I sometimes do) because I find the volatility in the market very exciting at times.

At the end of the talk someone in the audience asked me if there were any opportunities when you had a mortgage (or mortgages) to deal with.

The common practice used by most is to apply cash to reducing debt — and not save it for investing. There are exceptions, of course, such as KiwiSaver and the like, but the general rule stands that debt should be paid off first before investment begins.

So the person in the audience, feeling a little awkward no doubt, asked me how he should deal with his debt.

Yes I agreed that money is cheap these days — so why not borrow it and then borrow some more at every chance while low interest rates last? Continue reading →

Olly Newland interview – How to respond to the financial crisis


Long time investor and best-selling author Olly Newland is interviewed by Empower Education’s Peter Aranyi about the latest events in global markets — and gives his views on how local investors should respond.

AUGUST 2011: World financial markets react with turmoil due to the US credit rating downgrade and sovereign debt crisis — shedding value and displaying a nerve-wracking volatility that makes many question their investment strategies. What is the way forward? How will these world events affect our local property market? How should investors react — and how should YOU react?

Olly Newland has lived through many such troubled times. While Olly would never say he ‘knows it all’, in this 13 minute audio interview he outlines his view of the current financial crisis, he discusses the ‘change in the times’ brought on by this increased market volatility, what it heralds, and suggests what steps you could take to protect yourself.

Listen here:

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

or download an MP3 file here (13 minutes 6.7MB):
Olly Newland – How to respond to the global crisis

© 2011 Empower Leaders Publishing Ltd. All rights reserved.

Related: Olly’s book Lost Property relates his experience in previous financial market convulsions and important lessons he drew from those times.