By Cam Harper*
For decades, owning property beyond the family home has been an almost surefire way to make money in New Zealand.
In fact, for many people, property has been a central part of their retirement plan.
But as property prices fluctuate and other market conditions change, for many Kiwis, owning an investment property is no longer as attractive as it once was.
If you’re relying on investment property as part of your financial plans, it’s always helpful to get personalized financial advice for your situation.
However, my team and I are seeing Kiwis adjusting their real estate investment strategies to give them the advantage of investing in real estate, without the hassle of owning property.
We strive to provide Kiwis with investment choices with good returns and tangible security.
Investment choices with good returns and tangible security
You no longer need to own a property to make money from houses in New Zealand.
With over 25 years of experience, we manage a specialist lending division that identifies high-quality, short-term lending opportunities across residential construction and housing projects.
When a loan application passes internal approval processes, we lend our own money to the owner and then load the loan into our secure online investor portal.
We lend at conservative loan-to-value ratios of up to 65% of completed value for construction projects and up to 70% for residential refinance. This gives investors a buffer if things change during the life of the loan.
It is these loans in homes and building projects that Kiwis invest in. The Kiwis do not invest in Southern Cross Partners. Instead, they choose the specific project in which they want to invest their money.
Currently, investment interest rates start from 6% per annum, but are subject to change and availability.
Click here to see your potential investment earnings.
What we look for in our investments
Most of our loan applications go through mortgage advisers that we have worked with before.
Generally, our clients cannot get loans through banks for legitimate reasons and come to us for a short term loan to complete them.
We are very careful who and what we lend to. Over the past 25 years, our prudent approach to credit has served us and our investors well.
Before approving a loan, we need to know how a person will get out of their loan with us and when that will be. This way we can tell investors what our investment schedule is.
Here are the top ways people exit their loans with Southern Cross Partners:
payment. After a year of working with us, borrowers have their finances in order and are ready to switch to a traditional bank.
Sale of assets. This is a clear and common exit strategy, especially with our construction clients and people who bridge homes. They sell the properties they’ve built or bought, and then they’re free to start their next project.
Refinance once agreed. We find that banks generally do not support construction projects before permits are issued. We work with borrowers to give them the financing they need to secure the property. Then, once borrowers have sorted out the steps needed to begin construction, they decide whether to get a traditional bank loan or wrap it up in other debts they have.
There are myriad other exits at the end of a loan, so we always start with a conversation about what the borrower is trying to achieve and what their plans are after the loan.
Learn more about Southern Cross Partners investment opportunities Click here.
Disclaimer: All investment opportunities are subject to change and subject to availability. Southern Cross Partners Ltd is licensed to provide peer-to-peer lending services under the Conduct of Financial Markets Act 2013. This article is general in nature only and has not taken into account any particular person’s goals or circumstances. We recommend that you consult a financial adviser before making any investment decision.
* As Managing Partner of Southern Cross Partners, Cam Harper leads both the firm’s lending and investment activities. He is passionate about helping New Zealanders achieve true financial freedom through specialist loans and secure investments.