Investing in property in New Zealand while being on the other side of the world can be challenging, but the internet has made it easier to acquire properties remotely. However, finding a great property still requires getting the basics right. Here are some key considerations for remote property investors:
1. Plan for Success: Start with a clear plan and set goals. Determine how much equity you want to generate and specify the type of house you desire and the timeframe for acquiring it. Having a plan will prevent time wastage and help you stay focused on achieving your objectives.
2. Effective Communication: Clearly communicate your expectations to all parties involved and ensure they understand your instructions. Remote communication is crucial, so be proactive in keeping everyone informed. Don’t assume that things will happen automatically—follow up and confirm that tasks are being completed, especially considering the time zone differences.
3. Line Up Advisors and Tradespeople in Advance: Before you need them, establish relationships with advisors and tradespeople, such as lawyers, accountants, valuers, and building inspectors. Having them ready will enable you to act swiftly when a property of interest becomes available, avoiding delays caused by last-minute searches for referrals.
4. Manage Finance Challenges: Finance can be a stumbling block, so strive to secure unconditional approval before the unconditional date specified in the contract. Pre-approval is not enough, as conditional requirements may arise later in the process. Ensure you address any concerns or conditions promptly to avoid unnecessary delays.
5. Sort Legal and Tax Structures: Seek expert advice on legal and tax structures well in advance to ensure compliance and mitigate risks. Cross-border tax matters, in particular, require specialized knowledge to avoid potential pitfalls.
6. Conduct Thorough Research: Leverage the internet to research areas with promising capital growth if you’re an investor, or investigate suburbs within your price range if you’re a homebuyer. Use reputable online platforms like www.realestate.co.nz and www.trademe.co.nz, but also inquire with agents about off-market properties that may not be publicly listed.
7. Independent Verification: Engage professionals to conduct independent assessments of the property. Arrange for a registered valuer to perform a current valuation (preferably within three months) rather than relying on outdated or less reliable assessments. Additionally, hire a building inspector to identify any structural issues. Review the contract, title, and Land Information Memorandum (LIM) to gain a comprehensive understanding of the property.
8. Consider Time and Time Zones: Allow ample time for negotiation and due diligence. Don’t feel pressured by agents urging you to move quickly. Negotiation processes often work in the buyer’s favor as time goes on. Ensure your due diligence clause is comprehensive to protect your interests. Use the advantage of distance by communicating via fax or email instead of relying solely on phone conversations, allowing you to respond at your own pace and maintain control of the process.
9. Take Action: Once you’ve completed due diligence and agreed on the price, take decisive action. Move forward with your plan and stay focused on your goals. Don’t let the distance deter you from seizing investment opportunities.
By following these guidelines, remote property investors can navigate the challenges and make informed decisions when investing in New Zealand’s property market.
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