A prophet is seldom welcome in their hometown.
Similarly, Kiwi’s have to make it big, before they’re acknowledged locally.
When it comes to many types of investments, you spot a similar theme. It’s not until you see things succeeding overseas, that Kiwi’s sit up and take notice.
Recently some research came up that showed NZ didn’t even feature in terms of worldwide crypto adoption, for example.
*source: Milk Road
So when I hear that to Australians, New Zealand commercial property looks attractive on a relative basis, I’m intrigued as to why, yet again, Kiwi’s haven’t spotted the opportunity.
Depending on what numbers you look at, the amount of new money that enters circulation is about 8% a year. We live in debt-based economic system that depends on an expanding supply of new money for stability. This is the real inflation story that seldom hits the headlines – Every 10 years as a result of the system we live our lives in, what we own is sliced in half, from a purchasing power point of view. If we don’t invest and achieve a rate of return greater than this, after fees and after taxes, we go backwards.
The only option we have, is to invest as much as we possibly can, and take risk, as much as we can, just to preserve our savings. It’s not a left or right political thing – it’s a broken money thing.
Direct commercial property investment may offer great returns, but it’s an asset class available only to those who have high income, and high amounts of pre-existing wealth. Quite often, property investors will often sell down their residential properties at time of retirement and reinvest into commercial property as part of a ‘grow first, then harvest strategy’.
Is commercial property an opportunity for you to own a slice of ‘above-average’, before the masses wake up?
Today I’m talking with Scott O’Neill and Dylan Menzies from Rethink Investing.
Direct commercial property isn’t a common asset type in many everyday investors portfolio, but for a few reasons as we covered today, I think perhaps it will be in the future. As usual, I’d very much recommend you build wealth according to a strategy, rather than chase opportunities that sound good on a podcast – ideally get some professional advice even before getting into commercial property investment– make a time to chat if that’s of interest.
