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UPDATED: SUNDAY 8 SEPTEMBER 2007

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Rental investment yields dip to new lows
Rental yields are at some of the lowest levels we have seen in many years.

Many couples consider investment/rental properties as an ideal investment.
They seek both yields from capital gains and the rents. Here is our guides to understanding what are good investments.

Can you claim the cost of a new kitchen as a repair?
Is it a repair or an improvement. Here are some rules to help you find your way through the problem.

Question we have been asked?
We bought a property after attending a seminar. The valuers report gave a long and detailed breakdown of all the parts of a building. They valued the walls separately from the building and plumbing separately. Can we really do this? Is it a repair or an improvement. Here are some rules to help you find your way through the problem.

Depreciation - should I claim it?
This is second most common question we are asked about rentals. The answers we give today are different from five years ago.

Calculating yields

What's is a good yielding property?

A simple formula

We don't claim ownership of this formula as it published both in NZ and overseas.

First approach.
Price of property x 2 /1000 = rental.

For example: $100,000 property x 2 = $200,000 / 1000 = $200 a week rent. 

In this example a $100,000 property that can tenanted out for $200 a week will give a reasonably good yield.

Second approach.
Expected rent /2 x 1000 = Buy price

For example: $200 pw rent property / 2 = $100 x 1000 = $100,000 purchase price . 

In this example earning $200 a week rental will justify spending $100,000 on the property.