Investing Overseas (Especially New Zealand)

[macka]

Hi, I am curious about investing in property in other countries, especially New Zealand, but im not sure of whether there are complications with investing in another country. Does anybody have any info about this? I would like to find out if:

- Australians have to buy off a certain overseas investment register/list, regulating which properties we can buy
- The rules re investing in these countries (ie. any rules about foreign investment); and
- How to obtain finance (ie. do we need to get finance from that country
and therefore repay in foreign currency or can we get finance in
Australia to finance that investment), and will Australian lenders charge extra for having to value and settle a property in another country.

Any help is much appreciated!

Adam Mackay

 

[Ruby]

If you do a search macka you will find lots of previous discussions on overseas investing.

Check this thread out for a start.

http://www.somersoft.com/forums/showthread.php?postid=33056#post33056

Ruby

 

[Marc]

Hello !

- Australians have to buy off a certain overseas investment register/list, regulating which properties we can buy

<MARC>
Nope - you can buy from anyone/anywhere in NZ.

- The rules re investing in these countries (ie. any rules about foreign investment); and
<MARC>
Try these sites->
http://www.investnewzealand.govt.nz/page_Article/0,1300,3000,00.html

http://www.investnewzealand.govt.nz/common/files/50 Things.pdf

- How to obtain finance (ie. do we need to get finance from that country
and therefore repay in foreign currency or can we get finance in
Australia to finance that investment), and will Australian lenders charge extra for having to value and settle a property in another country.

<MARC>
hmm not sure on this one - I would love to know this as well.

 

[RC1]

Marc,

I'd like to have a chat with you regarding the trust structure you use in NZ. Could you email me on [email protected]

thanks,

Rod.

 

[jym]

Hi Guys

In NZ there are basically 4 main structures for property investment. They are: the sole trader or partnership, the LAQC, the family trust and the trading trust.

I set up a family trust and then set up a LAQC to operate within the trust.

A LAQC is a Loss Attributing Qualifying Company. It has 2 advantages and 1 disadvantage.

They are: any losses that the company makes can be attributed directly back to the shareholders in the ratio of their shareholdings.

and that distributions of capital gains by way of dividends can be distributed as tax exempt dividends.

The disadvantage is that the investor must accept personal liabilty to the IRD for any income tax liability the company has in the future.
This is often not a significant cause for concern for Property investors, as often the investments will trade at tax losses due to the burden of the interest costs and the depreciation allowances.

Remember that there is no capital gains tax in NZ and also there is no GST with investment property.

Get expert advice before investing in NZ.

Regards