Hmmmmm.
Basal cell carcinomas and melanomas slightly faded into insignificance at Pauanui Beach this Christmas.
It seemed that every big wig investor/banker/economist/finance minister in the world (from Warren Buffett down) had participated in a December telephone conference and agreed to carefully use the same lingo….
“It’s a life event but we will come through it.”
And our hero Alan Greenspan is somewhat “bewildered”.
We appraised a leasehold (no ground payments until November 2011) two storied, two bedroom Terrace by the Vector Arena (waterfront) rented at $400/week in January 08 at $230,000 to $250,000.
The investor said he’d think about selling.
Then the Blue Chip debacle unfolded.
In May 2008 the investor asked for a fresh appraisal as he was nervous about the impact of Blue Chip vendors having to sell and flooding the market.
We said, regrettably, $210,000 to $220,000.
The investor said he’d think about it seriously.
Then the market suddenly woke up to the effects of leasehold real estate on investor income and the market finally differentiated. And the finance houses started collapsing, one by one.
In October 2008 the investor asked for another appraisal as business wasn’t going so well and he might “need” to sell.
We said, extremely regrettably, $175,000 to $195,000 and he would have to auction as even this estimate was extremely uncertain.
He said OK.
Then the world banking systems started to collapse and the “life event” predictions began (I think, to calm us down, like, it’s OK, really and should only happen once in a lifetime).
We hope so.
Sold at our last December 08 auction for $120,000.
No, not a good look.
But it was the market on the day.
At a current 14% nett return with mortgages at say 9% and headed rapidly for under 5% was this the bottom of the market (and a license to print money)???
We think so, so call us.
But more importantly, if you think you may NEED to sell call us right now, please.
Because you just don’t know.
Now let’s cheer up because fortunes are being made as well as lost.
And happiness and money are not correlated at all – although money does help.
Martin Dunn AREINZ
MANAGING DIRECTOR
