Property investment is a business and must be treated like one. Whether residential or commercial, a new property investor is now ‘in business.’ Not everyone is able to do this, because it’s not in their nature to cope well with such things. Dealing with tenants requires many personal attributes such as communication skills, patience, a working knowledge of the law, sometimes a very firm style of personal approach, and so on.
Trusts have become very popular in New Zealand with many thousands having been established in recent years. There is good reason for their popularity, as they are one of the best ways to provide protection to yourself and your loved ones from future adverse events impacting on your hard earned wealth.
It is a very tempting to want to do the renovation work yourself but if you are running your Property Investment NZ business to maximize your profits you need to carefully assess whether your time is best spent renovating or best spent finding and investing in property.
Leverage is borrowing to purchase an asset so that while you have control of the asset you have not as of yet paid the full purchase price of that asset. Leverage is commonly used in property investment. The net effect of leveraging is to multiply the possible return, and also multiply the risk run by the investor.
Are you tired of the problems associated with residential investment properties, such as tenants trashing your property, not paying rent and the ongoing cost of maintenance. Then commercial property may be of interest to you. However investing in commercial property is very different to investing in residential.