Financial advice for a fellow ferner
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<p>In amongst all the hoo-hah about Akl properties the fact that the NZ Ords is up 25% in the last 12 mths has been largely ignored.</p>
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<p>Unfortunately it too is probably due a correction.</p>
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<p>Investing in shares - all depends on how much you have to put in as you do need to diversify.</p>
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<p>The downside of shares is yr 25% growth is off a much lower base unless you have the balls to borrow to but shares (and can get the loan) whereas you get capital gain on the banks share of yr investment property as well as your own.</p>
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<p>Either works as a long term growth strategy. Shares are more liquid if the next Ms Rembrandt turns into more of a keeper than the last bitch.</p>
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<p>I'm cautious of property because while shares are also at all time highs there isn't a political party saying we need a policy to devalue the share market by 40%. Mind you I've been cautious for the last two years and hasn't that worked well....</p>
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<p>It comes down to personal preference, your appetite for risk and how much you can afford, but whatever you do expect to leave your money in place for a decade</p> -
<p>be some good shares going cheap in Europe now, no?</p>
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<p>Not sure I'm best qualified to give advice having gone on record in ~2003 that there were too many cafes and opening another was a dumb idea, and the real estate bubble was about to burst...</p>
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<p>Thankfully shares do better. I play a simple game of long run averages and trying to catch falling knives. Like Australian bank stocks when everyone else is losing their minds.</p> -
<blockquote class="ipsBlockquote" data-author="dogmeat" data-cid="596215" data-time="1468381584">
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<p>In amongst all the hoo-hah about Akl properties the fact that the NZ Ords is up 25% in the last 12 mths has been largely ignored.</p>
<p> </p>
<p>Unfortunately it too is probably due a correction.</p>
<p> </p>
<p>Investing in shares - all depends on how much you have to put in as you do need to diversify.</p>
<p> </p>
<p>The downside of shares is yr 25% growth is off a much lower base unless you have the balls to borrow to but shares (and can get the loan) whereas you get capital gain on the banks share of yr investment property as well as your own.</p>
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<p>Either works as a long term growth strategy. Shares are more liquid if the next Ms Rembrandt turns into more of a keeper than the last bitch.</p>
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<p>I'm cautious of property because while shares are also at all time highs <strong>there isn't a political party saying we need a policy to devalue the share market by 40%.</strong> Mind you I've been cautious for the last two years and hasn't that worked well....</p>
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<p>It comes down to personal preference, your appetite for risk and how much you can afford, but whatever you do expect to leave your money in place for a decade</p>
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<p>To be fair... there isnt a political party saying that either, just 'commentators' ... these commentators like Bernard Hickey generally dont know their ass fro their elbow.</p>
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<p>Who said this just a few days ago</p>
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<p><strong>Ironically, a 40 per cent drop would make housing more affordable for existing home owners because their mortgages would go down.</strong></p>
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<p>Really Bernard? Really?</p>
<p>Even Labour are not stupid enough to want a housing crash.</p> -
<p>no one really said that did they? surely not, that's beyond retarded. </p>
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<blockquote class="ipsBlockquote" data-author="mariner4life" data-cid="596248" data-time="1468386938"><p>
no one really said that did they? surely not, that's beyond retarded.</p></blockquote>
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Arthur Grimes, former RBNZ Governor said it. Don Brash didn't name a percentage figure, but generally agreed that housing affordability is impossible without some sort of "correction". -
<p>My two cents is avoid property. I don't like investing in something which would take work to manage. Property prices can't keep rising like they have been doing. Mostly I like investing in companies which give a good solid dividend return. Obviously a lot of people make a lot of money out of property but it isn't for me.</p>
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<blockquote class="ipsBlockquote" data-author="mariner4life" data-cid="596248" data-time="1468386938">
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<p>no one really said that did they? surely not, that's beyond retarded. </p>
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<p><a data-ipb='nomediaparse' href='http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11671668'>http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11671668</a></p>
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<p>He is a self and media described 'expert'...</p> -
<blockquote class="ipsBlockquote" data-author="Godder" data-cid="596252" data-time="1468387619">
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<p>Arthur Grimes, former RBNZ Governor said it. Don Brash didn't name a percentage figure, but generally agreed that housing affordability is impossible without some sort of "correction".</p>
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<p>that i can deal with, i was talking about the quote from Baron about my house price decreasing meaning my mortgage would be cheaper</p> -
<blockquote class="ipsBlockquote" data-author="Baron Silas Greenback" data-cid="596254" data-time="1468387777">
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<p><a data-ipb='nomediaparse' href='http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11671668'>http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11671668</a></p>
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<p>He is a self and media described 'expert'...</p>
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<p>jesus, he really said it. His whole article is a little fairytale-ish, but i would love to hear his explanation of that line. </p> -
<blockquote class="ipsBlockquote" data-author="Baron Silas Greenback" data-cid="596254" data-time="1468387777">
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<p><a data-ipb='nomediaparse' href='http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11671668'>http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11671668</a></p>
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<p>He is a self and media described 'expert'...</p>
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<p>May be missing the word 'rates'. </p> -
<blockquote class="ipsBlockquote" data-author="Toddy" data-cid="596270" data-time="1468389352">
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<p>May be missing the word 'rates'. </p>
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<p>Even then it isn't accurate. No reason to think that plummeting house prices would definitely be coupled with lower interest rates. It would be a factor of course, but there are lots of others.</p>
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<p>And 'Mortgages Rates' .. isnt grammatically correct either. So I don't think it was a typo.</p> -
<p>I think 'mortgage rates' in that sentence would be perfectly acceptable and I think a busted housing market would have a big impact on interest rates. I also think Hickey is an absolute cock, so I'm happy that his published sentence makes him look like a fool.</p>
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<blockquote class="ipsBlockquote" data-author="Toddy" data-cid="596281" data-time="1468390899">
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<p>I think 'mortgage rates' in that sentence would be perfectly acceptable and I think a busted housing market would have a big impact on interest rates.<strong> I also think Hickey is an absolute cock</strong>, so I'm happy that his published sentence makes him look like a fool.</p>
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<p>Agreed. He has some competition in <span style="color:rgb(84,84,84);font-family:arial, sans-serif;font-size:small;">Shamubeel Eaqub now though.</span></p> -
<blockquote class="ipsBlockquote" data-author="jegga" data-cid="596286" data-time="1468391362">
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<p>Agreed. He has some competition in <span style="color:rgb(84,84,84);font-family:arial, sans-serif;font-size:small;">Shamubeel Eaqub now though.</span></p>
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<p>At the least you could fix the formatting and pretend you knew how to spell it :)</p> -
<blockquote class="ipsBlockquote" data-author="Toddy" data-cid="596292" data-time="1468391684">
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<p>At the least you could fix the formatting and pretend you knew how to spell it :)</p>
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<p>Nah, I spent two minutes trying to google his name and gave up and went to the herald to c+p it.</p> -
<blockquote class="ipsBlockquote" data-author="Toddy" data-cid="596281" data-time="1468390899">
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<p>I think 'mortgage rates' in that sentence would be perfectly acceptable and I think a busted housing market would have a big impact on interest rates. I also think Hickey is an absolute cock, so I'm happy that his published sentence makes him look like a fool.</p>
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<p>It would arguable that housing crash would result in lower interest rates. But not in that sentence as he made it as a statement of fact. And it is not a sure thing that interest rates would drop with a housing crash. Housing crashes are horrible things with all sorts of consequences and pressures. Anyone wishing for one is either a speculator or a moron.</p>
<p>A 40% house price crash would be devastating for everyone. The whole economy would go into a tail spin. Idiots like Hickey seem to think a 40% reduction is the equivalent to just turning back on the clock, it is not. That 40% reversal process would be painful.</p> -
We had a 40% reduction in real house prices in the 70s but that was in an era of high inflation so the reality was price movement merely flattened out. <br><br>
In today's environment you'd need a real price fall with massive potential negative equity for many. <br><br>
Which is just awful to contemplate -
<blockquote class="ipsBlockquote" data-author="dogmeat" data-cid="596336" data-time="1468402415">
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<p>We had a 40% reduction in real house prices in the 70s but that was in an era of high inflation so the reality was price movement merely flattened out.<br><br>
In today's environment you'd need a real price fall with massive potential negative equity for many.<br><br>
Which is just awful to contemplate</p>
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<p>The only way that will happen is if the Asian investors look to pull out. Now, although that is unlikely, it can happen, as HK discovered around the SARS time, when prices fell around 70%.</p>
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<p>They've since come back 350% before dropping around 12% again, but some sort of black swan event could well trigger that sort of exodus in NZ.</p>
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<p>Abeilt, however, unlikely.</p>