Property Investment
Trump's tariffs and the impact on NZ
Private Property issue #153
Property Investment
3 min read
TradeMe teardown
Private Property Newsletter - Issue #154
The best and worst part of hosting the Property Academy Podcast? Seeing the deals, investors actually go through with.
I want to help Kiwis grow their wealth.
But every so often, I get an email.
Someone will send me a link to the Trade Me listing for a property they just bought.
Now, that’s not me throwing shade at Trade Me – or anyone wanting to build wealth
But there is a big difference between a nice-looking house and a great investment.
Here’s an example.
Good vs bad investment: what’s the difference?
I recently got sent a link to a property an investor recently bought.
So when I opened the link, I was curious …
Was it a shoebox studio in Auckland?
A do-up in Gore?
Nope. It was a shiny, beautiful New Build in Rolleston.
And that’s exactly the problem.
That might surprise you. After all,
- I like New Builds as an investment.
- I like Rolleston as a place to invest.
Here’s what he was planning to invest in:
It’s a beautiful home.
Great kitchen, real timber floors, golden tapware … the works.
And that’s the problem.
It’s the kind of house to buy if you plan to live in it.
Those extra features cost more – but don’t get much more rent. So:
- you pay more
- you take out a bigger mortgage
- but don’t get enough extra rent to make it worth your while.
Sure, your tenants will probably appreciate the nice touches, too.
But that doesn’t make it a good investment. Not every property that can be rented out is a great rental.
The warning signs of a bad investment
Let’s start with the price. It’s around $800K.
That’s not outrageous for a 3-bed new build in Rolleston.
In fact, that’s probably a fair price for this house. But as an investor, I wouldn’t be paying that. Here’s why:
#1 – It’s too big.
It’s a 190 sqm palace. Great for a family. Bad for your wallet.
Tenants pay for bedrooms, not square metres. Simple as that.
A smaller 4-bed home often rents for more than a larger 3-bed.
#2 – It’s too bougie
The gold tapware seems great. Until you have to replace it.
Those higher-spec nice-to-haves aren’t just expensive to buy.
They’re also expensive when they eventually break.
#3 – It (probably) has hidden costs.
Here’s a little tip. If you look at a photo on Trade Me. And the house looks new. Check if there are any curtains or blinds in the photos.
If there aren’t … they’re often NOT included in the price.
It can cost you at least $10k to put blinds in.
It also looks like there aren’t enough heaters to meet the Healthy Homes Standards.
So, first, you pay a higher price.
Then you pay an extra $10 - $15k+ to get it Rent Ready.
So what’s a good investment?
How do you tell the difference between a good and bad investment?
Cold, hard numbers.
Remember, you can use Opes+ (for free) to compare different properties.
Compare the one we’ve just talked about to a cheaper 4-bed in the same city.
Which is the better investment?
From a hard-nosed investor perspective … the smaller, more affordable 4-bed is the better call.
I’m guilty
I never want it to come across on the podcast or through this newsletter that all you need to do as a property investor is:
- Buy in Rolleston (or another area I like).
- And buy a New Build.
There’s a lot about the property you need to look out for. So, I’ll cover this even more in future newsletters.
But there are 30,000+ property listings online right now …
Trade Me shows you what’s available, not what’s good.
And the way to figure out what’s good … is to run the numbers through Opes+.
So here’s my challenge: This Easter weekend:
- Find one property on Trade Me (or one you already own)
- Run it through Opes+ (create your free account here)
- Then hit reply – and tell me what you found.
I’ll jump in personally (or loop in my team) to give you feedback.
Let’s make sure you’re building wealth — not just buying homes.
Andrew Nicol
Managing Director, 20+ Years' Experience Investing In Property, Author & Host
Andrew Nicol, Managing Director at Opes Partners, is a seasoned financial adviser and property investment expert with 20+ years of experience. With 40 investment properties, he hosts the Property Academy Podcast, co-authored 'Wealth Plan' with Ed Mcknight, and has helped 1,894 Kiwis achieve financial security through property investment.
