Category: Property Investments

Using overseas income for an NZ mortgage

Over the past decade, New Zealand’s housing market has been in a state of flux – to say the least! Property prices have shot up all over the country, and are continuing to rise – and are some of the most expensive in the world.

Recently, we’ve seen broad changes around who can buy and sell property in New Zealand. Generally, you’ll need to be a citizen or a permanent resident to buy a property, although there are some exceptions. Lending rules have changed as well, with most banks and lenders requiring higher deposits and anti-money laundering rules adding more hoops to jump through. To put it mildly, it’s a complex market and even trickier if you’re living overseas, or earning money from international sources. It will be a great idea, if you find a good mortgage broker in Auckland while applying for home loan by using your overseas income. A good mortgage adviser can help you to explain current lending criteria & help to prepare all documentation.

So, can you use international income to qualify for a loan in NZ? The answer isn’t straightforward.

Can you buy a house with money from overseas?

In this digital age, you can be living in one country and earning some or all of your income from another. While that has implications on your tax payments, it’s still fairly simple to use that income to qualify for a home loan in New Zealand. The banks will be interested in three things: how much you earn vs how much owe and spend, how much cash you have saved, and how secure your income is. If you’re a contractor earning from international clients, banks may see your income as less secure than if you’re employed by an international firm, for example. There may be some added complexity in proving your income in a form that the bank is happy with, but any excellent mortgage broker will be able to help guide you through the process.

What if I’m living overseas?

If you’re a citizen of NZ, Australia, or Singapore, you can legally buy here while you’re still living and working overseas, but getting a loan may be much more difficult. Many banks and non-bank lenders have tightened their rules around lending to non-residents with non-NZ income. You’ll generally need a larger deposit – at least 30%, so your borrowing power is drastically reduced. You’ll also need to be earning from a salary or wage, not from self-employment.
Even with those boxes ticked, some banks will still say no. Westpac, for example, will no longer lend to non-resident borrowers with overseas income.

How to buy a house with international income?

If you’re living in NZ and earning money from overseas, the simplest way to get into a property is to talk to a great mortgage broker. Lending criteria of the major bank and non-bank lenders change almost daily, so approaching each directly could mean a lot of paperwork, and a lot of disappointment! A mortgage broker will understand which banks will still be happy to lend to you, and which won’t. They’ll also advise you on how to package up your financial information to present the best view to the bank and help you sidestep potential issues that could get in the way of the big ‘yes’ stamp.

Consult an expert

Property values rising, money-laundering rules, residency in another country, proving your overseas income is secure – these are some of the complexities you’ll face when you want to buy a home in New Zealand with overseas funds. You can still do it if you tick all the right boxes and satisfy your lender that you’re worth the risk.
But why put yourself through the stress, when a mortgage broker can smooth the way for you?

Talk to Global Finance today about how to turn your overseas funds into a home.

How to do property investment in New Zealand

Property investment is a real estate property that has been purchased with the intention of earning return on investment whether either through rental income, future resale of the property or even both. A property investment can be on long term basis or short term intended basis for example in the case of flipping where real estate is bought then renovated then later sold on a profit. This therefore means the way in which an investment property is used has some significant impact on the value of the asset. And for that reason investors will always conduct studies to determine the best and the most profitable use for the property. According to financial analysts, New Zealand can be best place to do property investments. There are are many reason for this point of view. Firstly, New Zealand is one of the growing developed country. This country has excellent infrastructure and zero corruptions. Secondly, New Zealand government is very friendly for foreign investors. This country has open economic structure. It means any one can buy and sell property in New Zealand. In this blog, i am going to point out few advantages for having property in Auckland or other cities.

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How to do property investment in New Zealand depend of the following benefits:

– Firstly, i need to consider tax benefits. Many people prefer invest on property for getting tax benefits in residential property offered in New Zealand.

– Secondly, there is potential capital gains which are the second form of income from an investment on residential or commercial property; you will achieve capital gains when the value of the investment on the property increases. The idea of achieving capital gain is to look for investment properties that you will be able to purchase for below the market value expecting the price to increase.

– Thirdly, Negative gearing of investment on the property where your expense and outgoings are higher than the rental income and this tax advantage is one of the key benefits negative gearing. In New Zealand, many people prefer to invest on residential property for negative gearing of investment. It is good plan to invest on residential assets compare to saving money in Banks.

– Combining capital gains and rental income; where your main aim may be to buy investment that will provide both types of return on investment.

–  Impact of leverage on return on the return from the investment on property; leverage is when you buy an investment using borrowed money instead of your own. The more you borrow the more you are said to be leveraged and this leverage can be one factor that can accelerate your investment return.

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There are many financial brokers available in New Zealand who can guide you throughout the investing process. Most of them provide this service free as they can get commission from bank or real estate agent. There are also some benefits that come with using a broker in doing investment on property such as:

· Better access and or more convenience:  A broker or brokerage firm will have access to more property listed by other agent since he or she will do this as a full time job. Most importantly, they have better insights on property industry. If you find reliable and experienced broker, he or she must help you to find best property to invest.

– Most of brokers have excellent negotiation or conveyancing power. They will help in negotiations; many people don’t like negotiation or just don’t have time for negotiations so having a broker will aid you from this since he or she will be the one doing the negotiations for you this therefore saves you time, energy and resources you might have used in the process.

– The contract might be hard for to handle therefore having a broker will help you in handling the contract since he or she will be the one to handle the contact and ensure that all the terms are met. Moreover, you need to get appointment from lawyer for preparing contract or paper work. If you have broker, they will arrange these formalities by them-self as they are associated with law firm. I personally prefer to have lawyer for doing all types of paper work while buying or selling properties.

– Real estate agents and brokers cant like this is because they are licensed professionals who are bidden by certain work ethic thus they cannot lie since doing that will be against the work ethics.

– Everyone will save money if agents are used. If the buyer and the seller uses agents on an investment they will both save money since everything will be carried out by the agent all they will do is pay them a commission.

In conclusion property investment happens to be a lucrative business and seems to be beneficial to those who take part in it. New Zealand can be best place to invest your money. This country has not any restrictions for buying of selling. If you consider economic growth, i will prefer to invest in Auckland or Wellington.

If you have plan to have investment broker throughout your process, you may find local and friendly brokers or firm.