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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (32109)	4/2/2008 3:08:37 AM
From: Maurice Winn	Read Replies (1) \| Respond to of 219500

TJ, what is rental yield? Residential "investors" expect capital gains, not so-called "rental yield". Commercial property is more like 10% yield. Mortgage rates are pushing 10% now after creeping up over a few years. The NZ$ is at world record levels vs US$ = around US80c for NZ$1. In Y2K it was US40c per NZ$1. House prices have more than doubled [in NZ$], with the revaluing upwards based on about $100 bn borrowed from Mrs Watanabe who thought 6% was a LOT better than 0% on deposit, or stacked in the cupboard, in Japan. I'm not convinced that Mrs Watanabe is an expert in exchange rate risks in carry trade. Nor do I think the local yokels in NZ are experts on trade deficits, exchange rates, and debt management. With Mrs Watanabe and Mr Rugby, Racing and Beer as counter-parties, with banks happily clipping the tickets, there could be serious problems sooner rather than later. House prices are now falling, while interest rates rise. I think at some stage even the innumerate will start to figure out something isn't quite going as expected. Mqurice