'Buying NZ Property – Download the free sample readings!

NZ presents some of the most alluring property in the Western World; particularly given the greater easy of residency, the low cost of property, and the liveability of the country. In addition, there is no capital gains tax, transfer taxes, VAT/GST or wealth taxes in NZ, so rest assured that NZ property is tax-effective! Learn more now!

New Zealand Property Report 2010 - Download the table of contents or buy this 180-page report at our online store for just $US19.95.

Thursday, April 19, 2012

Long term interest rates outlook - NZ

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NZ - read this and learn - inflation rates will be down for 30-40 years so go out and buy a home, or float your interest rate. There is going to be a rise in rental yields, so you may as well do it now. We are not going to see inflation because China, India and others are resulting in a global oversupply of labour. Unions will probably disappear; but we will need to see land reform to avoid hardship in future. Hopefully the anti-intellectuals will not drive up into civil war.

NZ is of course strongly reliant on overseas savings, however the international rate will remain low.

Friday, April 13, 2012

Racism in NZ

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Racism is rife in NZ. Interestingly however it does not preclude you from surviving in this country. There are a number of strategies for avoiding it:
1. Don't walk on sidewalks; as you stand a greater risk of copping a beer bottle in the back of your head.
2. Deal in business through a local who gives you credibility. They will however extort a value from you, i.e. You pay them $80/hour to act as an agent for you, when they collect $130/hour...simply to facilitate the trade with a racist client.
3. Don't live or holiday where racists prevail or dominate. i.e. Anywhere from Wanaka to Christchurch is a problem, as well as the North Shore of Auckland, and I suspect Napier and Nelson areas, but that's just a guesstimate based on my analysis.

More interesting is how people are dealing with it. I see today that TV One News has released a story of how New Zealanders are now miraculously less racist today because of the earthquake. This strikes me as political correctness more than an actual shift in values. The attitude seems to be that - since racism is a taboo - if we convey a story that racism is not present and legitimate - then we can drive the racism underground. It just might work.

I guess you have to praise their efforts; but it makes you wonder whether the motivation is really just to protect those tourist dollars. I note that a different headline advances the argument that racism is getting as bad as Australia. This moral relativism perhaps betrays the moral commitment of some Kiwis because racism is far more prevalent in NZ than Australia; though of course much depends on where you live. I've lived and been in most places in both countries; and always with Asians...and I might also place this all in perspective...there is plenty of racism in Asia...that does not justify it.

The problem of racism arises for several different reasons:
1. The expectation that people accept your cultural edicts - and their unwillingness to do so
2. The attribution of certain value judgements to certain people
3. The collective persecution of certain people for not accepting or adopting your values
4. The attribution or correlation of certain negative consequences with immigrants. i.e. Usually economic consequences like the prospect of your neighbourhood becoming a ghetto, or overcrowded, lots of litter, unemployment (i.e. you can't geta job because of immigration).
5. The lack of connection with these people; or superficial exposure, that precludes people from appreciating their context

These factors constituent reasons why people might feel compelled to display racist sentiments. The flip-side is that Westerners feel more open and vocal in their right to express racial sentiments, so racism is more apparent in the West. The effect is the opposite. In the Philippines, people will travel 20kms to meet me because they think they can get some money out of me....because all foreigners are wealthy right? Or freely dispense visas. There is such a lack of awareness in the West as well. Not all Asian immigrants are factory workers; or retired prostitutes. A great many of them have more university qualifications and entrepreneurial zeal than yourself. Surely the best way to cure racism is to sentence offenders to 1 year of living in a foreign 'Asian' country. When I was in Japan 10 years ago, the 'truckie' father of an English teacher came over to stay with him; he was cured in 3 weeks. Over that time I witnessed a transformation in his personal expression and mode of engagement.

Monday, April 9, 2012

Report card for National Party

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Ok, here is my report card for NZ's National Party....I got a bit bored going through this list....but it gives them something to start on.
See this policy list from the National Party - reading this I am inclined to think that there is a lot being done. What is wrong with it? Firstly I am inclined to say that the National Party is not doing a very good job at getting its message out to the public. This is a document that needs to be dispersed. But it really is so anti-intellectual in the realm of welfare policy, education. It simply resorts to paying off the Maoris; as if that will advance welfare. There are huge opportunity costs by not acting.
1. Future fund – good stuff
2. Road development – why does the govt need to develop ‘new’ roads; or is this merely ‘justified’ maintenance.
3. Road arteries – why does the country need to invest in new arterial roads when oil prices are high and the population is static. Is there any return on this investment?
4. Regional road infrastructure – probably justified
5. Regional rail infrastructure – probably justified
6. Regional infrastructure – probably justified
7. Regional rail infrastructure – justified in the context of higher oil prices
8. Auckland rail infrastructure – justified in the context of growing population and higher oil prices
9. Inter-island terminal – they are studying the value of a terminal at Clifford Bay. This would avoid the mountains around Blenheim and Kaikoura. Container terminal on the south island might make sense, but is this a govt project? And its already fairly close to Christchurch. The market appeal could only be for local trade? Why not a connection to Australia?
10. Broadband – worthy spending
11. Rural broadband – not a priority beyond the major towns; at least not off main trunk lines and towns under 40,000.
12. Digital switchover – fine
13. Network for learning – fine
14. National grid – fine, the network is not terribly stable, so needs upgrading, though they need to fix the pricing model for electricity.
15. Home insulation – sensible intent, the problem is the subsidy just forces up the installers fee. I would also add that it contradicts global warming. Insulate houses and people start heating homes, stop wearing woolen garments. i.e. they buy cheaper Chinese cotton, stop buying expensive NZ wool.
16. Upgrade state housing – better still fix the economy so they can buy the home, and given them incentives to do so.
17. Health expenditure – There is an expectation of the latest medical technology; this requires more spending in this area. Popular policy; but priority beyond immediate maintenance? Maybe it makes more sense to send people over to Australia? I wonder if shared infrastructure with Australia is a better model?
18. Schools upgrade – Probably justified, but the problem is that the biggest issue is school ‘content’ not infrastructure. Kids don’t learn to think at school. So this is a very anti-intellectual policy…typical of a pragmatic govt.
19. Earthquake Recovery – Fair enough
20. Sports stadium – not sure why this is policy. Popular…but it doesn’t make money.
21. Resource consents – this is very important policy – reasonable expectations
22. RMA streamlining – this is very important policy – reasonable expectations
23. RMA council punitive fines – this means the rate payer pays right? Well, I guess they get the investment, and can spurn council?
24. RMA streamlining – fine
25. Natural hazards – RMA consideration of natural hazards. Really? This is new?
26. Fresh water policy – fine, but is it a priority?
27. Simpler plans – sometimes simple is not the issue.
28. Trial employment – I don’t agree..employers will just pay staff to leave earlier, so its just a cost. You can’t legislate common sense.
29. Personal grievance reform – This is probably the way to deal with last issue. Not compulsory labour costs
30. Holiday Reform – This is ok
31. Hobbit law – yep, keep the film industry happy
32. Youth wage – yep, kids need every opportunity to save money to leave the country.
33. Collective bargaining – End collective bargaining, its extortion; though you do have to offer people a union-based channel to take grievances to some objective employment court; or ‘grievance’ system (see #29)
34. Constructive dismissal – this ought to be part of #29.
35. Flexible worker terms – I understand worker needs for fixed roster, as well as corporate desirability for flexibility. i.e. Is this so hard?
36. Ban of lights & thermal power – There is no need for a ban on thermal power plant, as no one is going to build one now. Light bulbs issue; non issue.
37. State assets – selling power stations is not going to make them more competitive; in fact, you can expect greater extortion, as is happening by most of the larger businesses because there is no population growth, and inadequate regulation.
38. Utility competition – Making it easier for consumers to shift utility does not address the costs built into the system; that’s economic rationalism, but it does serve govts with an eye on asset sales.
39. Hedge market – sensible
40. Consumer compensation – sensible
41. Less regulation – cut bureaucracy but don’t abandon regulation
42. ACC funding – yep, needs to be sustainably
43. ACC ratings – yep
44. Employee levies – yep
45. Employer levies – yep
46. ACC choice – Any sign its over-priced? It might add to cost
47. ACC choice – Any sign its over-priced? It might add to cost
48. Mobile telecom termination – fine, but what about data??
49. Telco competition – fine
50. Productivity Commission – so late? Should have been done 2 decades ago…assuming that anyone will listen to it.
51. Mining & energy safety – good idea – 2 decades too late! Oh that’s right, Labour ditched it in 1993.
52. Fishing regulation – fine
53. Fast track building consents – good stuff
54. DIY reform – good stuff
55. Leaky homes – Drop this as installers just take the subsidy.
56. Building sector accountability – fine, but what about the extortion in hardware sector.
57. Financial sector reform of regulation – yeh, good one….you will never do it really. Or you will do it, then in 5-10 years you will undo it.
58. Financial service regulation – training is not the issue; ethics and responsibility are the issues, but you’ve spurned education, so toss that idea.
59. Kiwisaver investor – fine
60. Regulation of securities - fine
83. Water storage – yep, don’t build levy banks in Wanganui, build a river diversion scheme and generate more power.
84. Petroleum exploration – great stuff! You are listening to me. Personally, I’d be spending $100mil, not $40mil.
85. Environmental regulation – fine
86. Petroleum permits – fine, but retain a good state royalty; don’t give away all the ‘resource’ as you will end up with immensely rich people who did not earn it (all), and then the ghost of Helen Clark or Gillard (or you) will expropriate it.
103. Convention Centre – don’t use gambling to finance a convention centre. How silly is that. If it does not stand up on its merits, then don’t finance by appealing to ‘vices’. This is silly policy.
104. Air transport – What about air transport to Australia – open it up guys! I want to fly Wanganui to Newcastle or Byron Bay, not to Sydney.

This leaves me wondering what is missing – I would add the following:
1. Improve biosecurity – NZ food output is important, and so is Australia’s, so less please them to get greater access to the Australian market place.
2. Adopt ANZAC liberalization – open up deregulation of pan-Australian flights
3. Sell Air New Zealand – the enterprise is well-run, it will never be worth more than in a few years when the market recovers.
4. Adult education – What about intellectual literary and parenting literacy??
5. Local government reform - I don't see this on the list, but I understand some constraints are being placed on local govt...Good stuff.
6. Gas industry

Now, if we were going to be entirely honest, the National Party would also say that:
121. Prison construction - they are building more prisons because the economy is going to the dogs.
122. Taxation - they are building a $1 billion super computer to tax people better. i.e. More more pernicious form of enslavement because they don't know how to encourage people 'voluntarily', they feel compelled to tell us how its done.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Saturday, April 7, 2012

Was the collapse of Canterbury Finance a surprise?

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I was just going through my newspaper clippings and I came across an advertisement which is rather interesting. It is an advertisement by South Canterbury Finance, the now liquidated financial services company that was supported by the government. Some interesting facts emerge:
1. They disclose a $NZ 82.7 million Net Profit Before Tax in the year to June 2008; not so great on on the $2 billion in assets. i.e. that's 4%, and that was before the slump in the markets
2. They had a investment credit rating of BBB-, which is a pretty poor credit rating.
3. They are expanding, by adding an office in Wanganui, a dying rural town you might say given that since 2006 its population has been falling. Clearly they were appealing to a rural constituency, and they wanted to grow their assets to allay doubts.

So its not like there was no evidence of problems....and that's just from their own promotion. The problem is mostly that in NZ, no one knows how to read a balance sheet or the economic outlook. Just to put your minds at ease:
1. Look for a AAA+ or AAA- in the credit ratings; and respond when the credit agencies do because they can work on the basis of perceptions, just as you do...or context if you like. In a bull market, no one cares about a bad credit rating.
2. The outlook is for higher commodity prices, strong NZD, a two-speed economy, with high oil prices, the strong NZD going to undermine economic activity. There is going to be an attack on North Korea and Iran within a year; they will be short-lived occurrences, but they will hit market confidence, so sell your shares. The US and other central banks will then look to offer stimulus, so you might expect a recovery thereafter. Give it a year to turn around, so we are 2 years away still from the resumption of the China 'bull market' story.

Thursday, April 5, 2012

Best aspects of New Zealand

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There is so little in New Zealand that is good, however a few things that come to mind:
1. The cool crisp breeze when its accompanied by a blue, clear sky....not bad for power generation as well.
2. NZ apples - they are juicy and sweat
3. Whittakers chocolate - when its on sale. Sadly, they know its good. :( Still, chocolate in NZ is relatively cheap.
4. Southern alpine ranges - a great source of scenic and recreational pleasure, i.e. photography, mountain biking.
5. The political system - NZ has at least in relative terms the best political system in the world thanks its its Mixed Member Proportional (MMP) voting system which gives small parties a break; the absence of a constitution, which means its got no entrenched system which makes it impossible to change; no redundant 2nd house or state parliaments, thanks to its small size and population. Sadly, that is trumped by a great many unthinking people.
6. Cheap housing in nice places - NZ has some of the cheapest housing in the world. Even if its crap housing, it does the job, but you have to be prepared to live in depopulating locations which seldom offer work. Paradoxically this means you will have money, but a desire not to spend it. So its not really a good deal.....you are better off looking at Japan. Houses are so cheap there.
7. Queenstown is probably one of the best places to live in the world. The only negatives are that its expensive because of zoning restrictions, and its got a short day being so far south, and its a little on the cold side, but relatively ok. Its great weather most of the time, its chock full of lifestyle activities, close to airport, direct access to East Coast Australia, and its mostly owned by Aussies...well, at least it should be. I don't know why we have not annexed it yet. I guess the Closer Economic Relationship (CER) is just the politically correct way of doing it. I note that Bob Carr, NSW politician bought land here, so we are close to having a new government here. Provisions have already been made in the Australian Federal Constitution...its all good. Just need to buy out the 'All Blacks' and change their logo to another 'black thing' and they will never know the difference.

Monday, April 2, 2012

Japan property cheapest in the world

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According to a recent survey, NZ has the second most highest property prices in terms of income in the world after Canada. Also noteworthy is the fact that Japan has the lowest housing prices in comparison to income. I encourage expatriates and Japanese people to look at the foreclosed property market because houses can be bought very cheaply through this route. I bought a 5br dormitory just 1hr train from Tokyo City Central in 2004 for just $US28,000. Prices have gone no where since. Its particularly cheap in rural areas; but being a populated island archipelago, its hard to get far from a major city....but you would be surprised how much scenic nature this country has, and how easy it is to explore by cheap train services. The yields are exceptionally good, and there is no better way to buy than via the foreclosed route because of the lack of competition as well as the security of dealing with the Japanese court system. They even help you remove any 'problem' owners....but anyway most Japanese are so polite, they might even help you move out. Mine was lovely...gave me some advice...to clean our the pine needles from the roof guttering....since his home had a little water damage. Perceptions of people wanting to cause injury to you are over-stated. Consider that most distressed buyers are happy to stay in these houses just to get low rent. i.e. The banks want to claw back equity....but in fact the owners simply want to retain the cheap rent since Japan has for the last decade had record low interest rates....even lower than enjoyed by the rest of the world. I therefore recommend buying property in Japan because its such a pleasant place to live and to cheap to buy. The most expensive aspects of Japan are the utility and eating-out expenses, but you'd be surprised how reasonable it is to buy:
1. Takeaway - good quality for $5-8
2. Train - $3-4 even for outer city
3. My stepbrother is getting Wimax internet for $10/month under a special deal
4. Land rates - I pay $US1500 in NZ, but its just $300 in Japan, and its so safe I don't even bother insuring my place.
5. Japan Rail Pass allows you to travel around Japan for $300-350 for a week unlimited, including on Shinkansen.
6. Beers are Y600, but you can get as low as Y300 in Roppongi and drinking at home is really cheap.
I am simply blown away by Japan because there is simply no better place to live. I will be returning there in a few years I suspect, as my partner's brother lives there. My focus is however on work at the moment. Learn more about Japan foreclosed property!

'Buying NZ Property – Download the free sample readings!

NZ presents some of the most alluring property in the Western World; particularly given the greater easy of residency, the low cost of property, and the liveability of the country. In addition, there is no capital gains tax, transfer taxes, VAT/GST or wealth taxes in NZ, so rest assured that NZ property is tax-effective! Learn more now!

New Zealand Property Report 2010 - Download the table of contents or buy this 180-page report at our online store for just $US19.95.

Japan Foreclosed Property 2015-2016 - Buy this 5th edition report!

Over the years, this ebook has been enhanced with additional research to offer a comprehensive appraisal of the Japanese foreclosed property market, as well as offering economic and industry analysis. The author travels to Japan regularly to keep abreast of the local market conditions, and has purchased several foreclosed properties, as well as bidding on others. Japan is one of the few markets offering high-yielding property investment opportunities. Contrary to the 'rural depopulation' scepticism, the urban centres are growing, and they have always been a magnet for expatriates in Asia. Japan is a place where expats, investors (big or small) can make highly profitable real estate investments. Japan is a large market, with a plethora of cheap properties up for tender by the courts. Few other Western nations offer such cheap property so close to major infrastructure. Japan is unique in this respect, and it offers such a different life experience, which also makes it special. There is a plethora of property is depopulating rural areas, however there are fortnightly tenders offering plenty of property in Japan's cities as well. I bought a dormitory 1hr from Tokyo for just $US30,000.
You can view foreclosed properties listed for as little as $US10,000 in Japan thanks to depopulation and a culture that is geared towards working for the state. I bought foreclosed properties in Japan and now I reveal all in our expanded 350+page report. The information you need to know, strategies to apply, where to get help, and the tools to use. We even help you avoid the tsunami and nuclear risks since I was a geologist/mining finance analyst in a past life. Check out the "feedback" in our blog for stories of success by customers of our previous reports.

Download Table of Contents here.