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Why should I use a financial adviser?
By using a Financial Adviser, you have access to the entire market and always have someone in your corner. It’s our job to make sure you have the right strategy and structure for your future, and get you in the best possible position for success.
Properli are Financial and Property Investment Advisers that enable you to unlock the potential of property ownership to secure a better financial future. Properli Advisers offer tailored support and advice to get you started on your journey to property ownership. We simplify the process by removing the jargon and the heavy lifting with the banks and all the paperwork enabling you to get a clear picture of all options available to you.
For the most part, what we do is free! It depends what we will need to do for you. All fees will be communicated upfront, so there’s nothing sneaky. The first initial consultation is free, so all you need to do is reach out.
Why do I need to provide so much information?
For each application, we require as much information about you and your situation to be able to recommend and provide the best solution for you. In the same way you would disclose your medical history and situation to your doctor, you should disclose your financial history and situation to your financial adviser. We’re here to help.
What is the Design a Decade Planning Tool?
Design a Decade is a service provided by Properli, taking a long-term approach to wealth creation through property investment. Typically, it takes around a decade of thoughtful investment before you begin to see significant returns.
This service imparts individuals with the financial freedom to make decisions around working less, retirement or expanding their property portfolios in a calculated manner. By employing the ‘Design a Decade’ strategy, investors can establish a well-defined plan to achieve financial objectives within their decade. This process should be reviewed annually to ensure it aligns with your personal objectives and evolving circumstances.
I’m overseas – can you still help me?
Absolutely! We have many clients based all over the world – thanks to technology, we can service you wherever you are. As long as you are a New Zealand citizen or resident, you can purchase property in New Zealand, regardless of your physical location. If you have a residence class visa but are not an ‘ordinarily resident’ yet, you can buy or build one home to live in as long as you get consent from the Overseas Investment Office before doing so. You are able to apply for pre-approval that lasts up to a year.
I’m a New Zealand citizen but I live overseas, can I buy property and get a home loan?
Yes you can! It’s all dependent on income and stability of the income, for example, having a stable pay check. Generally, lenders and banks will convert your income to New Zealand Dollars, scale the income back for tax purposes, and then use this to figure out how you can service debt. Deposits of course vary, but anything is possible.
The Debt-to-Income ratios introduced on the 1st July mean you can borrow no more than six times your household income if you are purchasing an owner occupied property or a maximum of seven times your household income if you are purchasing an investment property. However, the banks do still take into account your actual income and expenses so the process can get quite complex. Speaking with an Adviser is recommended to get the best result possible.
Is it better to get a mortgage or home loan from a bank or broker?
The beauty of utilising a broker or financial adviser is that it allows you to explore your options. Obtaining a loan from your bank can sometimes lead you to receive a ‘yes or no’ answer due to being restricted in product and credit by that provider. A mortgage broker is going in to bat for you at all times, meaning you will get the best result for you, not the best result for the banks.
How can I use equity from my existing property to invest in another property?
The power of leveraging equity and using the bank’s money to do so. Obviously this is case by case and depends on your situation.
There are two types of equity:
True equity is what your house is valued at, less your mortgage. For example, if your house is currently valued at $1,000,000, with a remaining mortgage of $700,000, your true equity is $300,000.
Usable equity is any amount of equity over the minimum threshold you are required to keep in the initial property. In the example above, based on an owner-occupier LVR (loan-to-value) ratio rules, $200,000 would need to remain to maintain a 20% true equity position. Meaning $100,000 would be considered usable equity.
What’s the most common mortgage type in New Zealand?
It’s called a Table Mortgage. This is a 30-year term on principal and interest repayments. In the first 20 to 21 years of the mortgage, interest is dominant. At the back end of this 30-year mortgage is where you can pay off the principal. There are of course other ways you can pay off your home loan quicker, but learning the basics is a good start.
Insurance is one of those intangible things that you don’t see the worthiness of, until you have to use it. Insurance protects you in an unforeseen event, such as loss of income, loss or damage of contents, loss or damage to a house, or loss of life. All insurance should be underwritten, which takes into account your family or medical history. This makes sure your claim is paid out correctly, and you’re all covered!
Do I need insurance? Won’t ACC help me?
Depending on what has happened to you, ACC may not be able to help. ACC is workplace accident cover, not illness cover! That’s why having health insurance, trauma or total permanent disability cover is important, because it means your most important asset is kept safe: you!
Why do I need house insurance for settlement?
Your house is a huge investment! Your lender will require you to have house insurance in place for settlement.
Why do I need landlord insurance?
In the awful event something happens to any investment property, you are safe from the worst of it. This could mean if your tenants run from paying rent, or a damage happens to the property by the tenants, you can breathe a sigh of relief that you’re covered for things outside of your control.
House insurance protects any damages to your home and will give you, and the lender, peace of mind should anything happen.
What’s the difference between bank insurance and an insurance provider?
Bank insurance, as a whole, is generally a much more watered-down version of insurance. It is often underwritten at the time of claim. With insurance providers, you have the opportunity to make sure you’re covered from A – Z, as you can underwrite beforehand. An insurance company or provider specialises in insurance only, so their policies, benefits, and terms are designed specifically for insurance, and with the customer in mind.
Why do I need an insurance adviser when I can just go directly to an insurance company?
We believe in free-will here, but we also believe in making sure our clients (you) get the best possible deal. Insurance advisers go in to bat for you to get you the best deal within your budget, and you don’t have to call an 0800 number, sitting on long wait times. Insurance brokers/advisers are experts in their fields, so you will receive personalised advice and a full understanding on how things get done.
Why should I invest in property?
Property is tangible
Compared to other investment options, property is a tangible asset, meaning it can be touched, seen and used. Tangible investments are often considered more concrete and real as opposed to stocks or shares. Property also offers direct ownership, allowing for more control and peace of mind due to reduced risk of fraud or theft.
Property is stable
Historically, over extended periods of investment, real estate tends to exhibit reliable and foreseeable returns. Data from REINZ indicates that property has consistently yielded an average annual capital growth of approximately 6%. Housing is a necessity and as population increases, the demand for property continues to grow.
Property is leverageable
The key benefit of property investment is the power of leverage, allowing you to profit from other people’s money, typically from banks. In certain situations, you can borrow the entire purchase price while keeping all the gains for yourself.
Property can provide passive income
While managing a property requires some level of oversight, it can be relatively passive compared to running a business or actively trading. Property management services can manage day-to-day tasks, taking more off your plate and reducing your workload. As debt is paid down, an investment can be positively geared, creating a stable income stream. Rental income and capital growth are provided by property over time.
Property is bankable
Traditionally, residential property investment has been favored by banks in New Zealand. With a unique approach, these banks are willing to finance property purchases up to 100% of their value, subject to individual investor circumstances. This is not a possibility for alternative investment options hereby allowing a significant opportunity for prospective investors.
What is considered a new build property?
By definition, a new build is a property that is being built or has been built and settlement has taken place within six months of Code of Compliance being issued. These are purchased via the developer or real estate agent and haven’t been preowned or on-sold. They are normally but not limited to residential lots such as townhouses, apartments or free standing homes and are turnkey or progress payment models via fixed price contracts.
What is considered an existing property?
An existing property, also known as a resale property, is one that has been previously owned by someone else. Existing property does not necessarily mean old, any property older than six months post Code of Compliance being issued is classed as existing and therefore doesn’t fit the New Build criteria.
Rentvesting is becoming an increasingly popular home-ownership strategy. It is where a buyer rents a house in a suburb they love, while buys a property as an investment somewhere more affordable and rents that out to tenants.
One of the key benefits of Rentvesting is getting on the property ladder and starting to generate income from that investment property sooner than purchasing a ‘dream home’. By owning an investment property, you have the opportunity to benefit from capital growth and rental income which can help you build equity and increase your ability to leverage it to purchase another property in the future – one that you may want to live in as your main home.
How can I use my equity to purchase an investment property?
If you do have significant equity in your current property, you can use this equity as leverage to purchase another investment.
As a general rule, you can take out a new loan which is secured against your existing property as the deposit for a property purchase, once the bank has decided how much they’re prepared to lend you (usually up to 80% of your home’s value).
Banks do regard such loans as being higher risk than those for owner-occupied properties because the rental market can fluctuate, and they know you’ll be dependent on finding reliable tenants who pay their rent on time, in order for you to keep up with mortgage repayments. Understand more by speaking to an Adviser about your specific financial situation. You might be ready to invest without realising it!