Posts by InternationalObserver
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and is the part-owner of a 29-inch, flat screen television
yeah, but let me guess who owns 100% of the remote ...
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Getting back OT. The F&R boys have been pinged for a transaction that took place in 2002. Years after the winebox debacle. This is the story that keeps taking.
There's a quite hilarious letter in this morning's NZ Herald from someone who thinks people shouldn't knock FR because they started with nothing and worked hard to build their company, and had done a lot of good things for NZ. The writer seemed deadly serious. They're either completely deluded or the non-deplume for Michelle Boag perhaps?
For those coming in late, this link is worth repeating. It's a pity the Herald don't link to it.
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Very good Michael! Kudos too to the Govt for finally waking up to the rort that was 'tenure review'. Taxpayers haven't been as royally screwed since the Govt sold off Telecom, NZ Rail, and the Govt Printing Office.
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I think it's more complex than that.
Yup, but I've found I need to talk in generalisations or otherwise my comments end up really long.
depreciating everything in sight and waiting for the capital gain.
At which point you have to pay back the depreciation claimed because it didn't depreciate - it gained in value. Many investors don't bother with depreciation any more, especially since the IRD changed the allowance to a flat %. Property gurus and real estate agents will tell you to depreciate because it makes their numbers look better. But they usually neglect to mention the words 'Depreciation Recovery'.
We need to raise the obligation of Property Investors to supply & maintain safe insulated housing.
Fine for new houses, but what about old ones? You can retrofit the ceilings but walls and floors are much harder. Labour have addressed this with their new building standards ie insulation as you've suggested will be mandatory.
The big innocent losers in the whole thing would strike me as being the people who bought at the peak of the boom at the maximum their income would permit.
One could argue they are greedy, but let's leave it at: a fool and their money are soon parted. There are a lot of novice investors out there who don't know how the property market works and have bought on the advice of their Uncle Jack (who knows a thing or two about property, but not really), or worse, a seminar they went to. They will get burnt badly as mortgage rates climb higher. it's been made worse by a longer than usual boom in the market. Many experienced investors are sitting on cash reserves waiting for the crash so they can swoop in and pick up cheap properties. Olly Newland is one who admits it.
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Finance Minister Michael Cullen has backed a call to "ring-fence" losses on investment properties - meaning they could no longer be offset against other income such as wages and salaries - but few other parties appear warm to the idea.
If Cullen can get this thru then he will make great inroads into dampening the Housing market. The majority of investment properties are yielding 4-6% which is a pittance compared to the on-call deposit rates currently available (even Kiwibank is offering 7.75%)
If investors can't offset their trading losses against their income tax the maths starts to look bad. Add in the increasing mortgage rates and the equation gets worse. I would punt that 50% of investors might decide its not worth it and put their properties on the market, hoping to realise a capital gain.
Of course, with all those houses coming on to the market at the same time prices must fall, surely?
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wot Andrew ll said
I'm not sure when, but fairly recently HNZ did insert clauses into their rental agreements with new tenants that HNZ retained the right to renovate or subdivide the property at a future time. Which is great because HUGE numbers of HNZ houses are sitting on subdividable sections.
The problem comes with those that have been in their house prior to this change. They are resistant to change, they are the ones who feel they 'own' their state house. That is the 'entitlement' I was alluding to. Imagine if HNZ ran the Unemployment benefit? The first 20,000 would get the Dole and the next 6,000 in need would be on a waiting list. Waiting for someone already receiving a benefit to die, find work, or retire. -
It starts with 'skin whitening' and ends with breast enlargement and a Brazillian.
This is explains why Islamist Fundies insist on the Burka then.
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wot RB said...
I don't dispute that Landlords benefited with the introduction of the Accommodation Supplement, because it obviously added to the number of people who could afford private rental housing. But don't blame the landlords who are filling the void left by 'limited' State Housing stock.
Rents are determined by supply and demand. They go down when everyone can afford to buy their own home, and up when they can't. They could also drop if the number of houses were increased to the point that demand is satiated. At that point premium stock would be in demand and grotty old mouldy dungheaps wouldn't.
Once the problem of state housing supply is tackled we need to address 'cultural' issues - ie why do people think once they've got a state house they're entitled to live there forever? (But that's a whole other subject).
Speaking of Fay Richwite (and we were) lets not also forget that NZ's other greatest business success, Graeme Hart, also got his start (well, a significant boost at least) from buying the Government Printing Office for substantially less than it was worth. Altho' TBF that's all he plundered from the Govt chest. The rest of his wealth came from buying and selling private companies.
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gee, don't ya just hate being the last post at the bottom of the previous page? Anyway .... I see there's probably no point in discussing it when terms like slum lords and Poverty Investors are used. I guess we (people who own a rental property) are all bastard scum, one step below Fay & Richwite. (which was the original topic)
BTW: Socialism For The Rich! ??? I think Labour prefer to call it Working For Families. Even with an income of $140,000 your family might be eligible.
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Not true Steven. The Accommodation Supplement gets paid to the Beneficiary not the Landlord. Landlords are lobbying to have the supplement paid directly to them because <wait for it> some beneficiaries don't pay their rent but claim the supplement anyway.
So the Govt forks out money to help beneficiaries pay their rent but they don't actually pay the landlord. And when the landlord goes to Tenancy Tribunal to recover the rent owed the beneficiary has no money and the landlord gets a judgement of $5/10 a week/month that invariably never gets paid.
Many Landlords believe that if the supplement is paid directly to them it will help prevent beneficiaries getting into rent arrears. Other landlords just don't bother letting to beneficiaries; despite it being illegal to discriminate.