Best Investment option?? Tauranga OR Hamilton OR Rotorua??

[Jamesvip]

Hi Guys, I am doing some homework before investing on a rental property in one of these cities. Surely would love my investment to appreciate in value too and get good ROI.
Currently i am preferring Hamilton out of these 3 cities.

I would love to know all views and the reason why u think so. Really appreciate your help

[avidza]

Lots of news and articles saying we shall see a drop in 2017, looks genuine because the mortgage v/s rent ratio is unrealistic or call it a bubble.

[johnkiwi]

Lots of news and articles saying we shall see a drop in 2017, looks genuine because the mortgage v/s rent ratio is unrealistic or call it a bubble.

Yes it's true that people have predicted a dip, but a dip in growth not a dip in prices. The rate of growth is unrealistic long term, this doesn't mean house prices will fall though. We might just see a much slower rate of growth, and a gradual catch up of income. I'm not saying this WILL be the case, but at this stage its more viable than it big fall.

[johnkiwi]

Hi Guys, I am doing some homework before investing on a rental property in one of these cities. Surely would love my investment to appreciate in value too and get good ROI.
Currently i am preferring Hamilton out of these 3 cities.

I would love to know all views and the reason why u think so. Really appreciate your help

Very hard to give advice in this market, however I would say you can't really go wrong with either of them. I think if the market changes, Rotorua is most likely to get a downward trend as its not a huge place of business. You could also argue that because of its holiday appeal, it could stay strong. One thing is for sure, if you can buy then now is as good a time as any. There is always the gamble of waiting it out, but as mentioned above I don't think things will get much cheaper.

Good luck!

[hoegaandit]

I have followed NZ property prices since around 1980 and done some further study for longer periods. There have been periodic surges some huge (eg mid seventies, mid to late eighties, early to mid 2000's and latest one followed by drops of maybe 12% - more in real terms - for the next number of years). Prior to I think around mid sixties properties kept pace with general inflation but since then - as in UK and some other countries - apart from declining rural areas they have massively outpaced inflation; hence the Kiwi obsession with property.

My main point is that we are towards the top end of the property cycle (especially in Auckland and surrounds) so for the short and medium term I do not think it is a good time to buy.

FWIW Tauranga has I think shown the greatest growth of any city or town in NZ over the last 70 years (google MOTU reports) but in my opinion it is near the top of the cycle now.

[JoA]

You seem to hve followed NZ real estate. Curous why Nelson has not been considered as a top spot? When I asked New Zealander's whike visiting the country where they would like to retire, if money was no object. Nelson was the answer I got most often. ANy ideas on this? JoAnn

[hoegaandit]

Well Nelson is not in the top 10 for growth since 1926 - http://www.nzherald.co.nz/nz/news/ar...ectid=11472908 - but it seems to have been growing consistently in recent years - see eg figure 5 on page 18 of this link - http://motu-www.motu.org.nz/wpapers/13_07.pdf

My guess is Nelson remains slightly isolated and wages are less than some other cities; personally I think it has a really lovely hinterland and Nelson gets good sun for NZ but as a city I think it is just good not great - doubtless some from Nelson will disagree!