\u201cThe houses we were looking at were like minimum half a million dollars and not the best neighbourhood where we actually would have wanted to buy, which would have been about $900,000.<\/p>\n
\u201cIt felt very unobtainable and I do definitely feel for everyone else that was kind of sitting there, because we were making good money and we still felt like that.\u201d<\/p>\n
Today, surprisingly, Hanover buys nearly one house a month and does them up to sell.<\/p>\n
So she has become a flipper \u2013 but a good one, she would say.<\/p>\n
\u201cI think there\u2019s a really bad reputation for property traders in New Zealand and I think what people need to understand is we\u2019re not buying the stock that first-home buyers are buying and we\u2019re not taking that away from them, we\u2019re actually creating it for them.\u201d<\/p>\n
Her business plan is buying uninhabitable homes banks won\u2019t lend on, including properties with asbestos or meth contamination, leaking roofs or houses with plain old holes in them.<\/p>\n
With her husband working on site and engaging contractors, Hanover upgrades the homes for sale.<\/p>\n
In two years, her methods have attracted many queries, so she started FundHaus, a property coaching business.<\/p>\n
Having sold her first house in August 2024, Hanover has been on a steep curve and is negotiating her 20th purchase, having sold 14 and rehabbing or holding the remaining five.<\/p>\n
\u201cI would say this is probably one of the hardest ways to make money right now.<\/p>\n
\u201cA big part of the structure [that] has changed is buying a house, then spending $40,000, making $40,000. Now it\u2019s buying a house and spending $200,000 to make $50,000.<\/p>\n
\u201cTwo years ago when I started … I could literally buy a house, paint it, put new carpet and a new kitchen in and sell it and make a good gain. <\/p>\n
\u201cSo it\u2019s a very different market than what it was two years ago and I\u2019ve seen it change very, very quickly.<\/p>\n
\u201cFor fulltime property investors, I think there\u2019s a lot of them doing it really hard and everyone\u2019s, \u2018tax the rich\u2019 and \u2018home investors are all wealthy\u2019 and things like that. But if you actually look at them, they\u2019re driving 20-year-old Toyota Corollas and not living in mansions.\u201d<\/p>\n
Property investing in New Zealand is now the domain for the “mindful investor” rather than a pathway to fast or big money. Photo \/ Getty Images<\/p>\n
Leaving home early, Matt Ball\u2019s neighbours\u2019 yellowy window lights shine into the dim winter morning as Auckland rises for another day.<\/p>\n
As he drives away, he glances sideways and knows there is pain on his street.<\/p>\n
\u201cI\u2019ve got a neighbour who bought an investment property and they\u2019re currently sitting on a $300,000 paper loss from that property. And then the neighbour on the other side… is sitting on a similar loss.<\/p>\n
\u201cSo, that\u2019s literally just in my one area, there are two people, I barely even have to step out the drive. And as I go around the country I meet regularly one or two people in that situation.\u201d<\/p>\n
Ball is the PR and advocacy manager for the New Zealand Property Investors Federation (NZPIF) and in Wellington, at a meeting of the local branch, he thrives on the energy from experienced investors, who enjoy sharing their experience and knowledge.<\/p>\n
But he acknowledges there are some downbeat souls who bought at or near the 2021 peak and are now squeezed between flat rental returns, inflation and rate rises.<\/p>\n
New Zealand Property Investors Federation PR and advocacy manager Matt Ball.<\/p>\n
\u201cI\u2019ve met people as I travel around the country talking to associations who have come to me and said, \u2018Oh you know I was a new investor, I bought at the peak, I didn\u2019t know it was the peak, now the price has gone down\u2019.<\/p>\n
\u201cThey are, I think, psychologically scarred by that.\u201d<\/p>\n
Ball advocates for property investment \u2013 it is his job \u2013 and says NZPIF members continue buying and providing rental properties to make money.<\/p>\n
But these days it comes with a caveat.<\/p>\n
\u201cThe casual investor, the person who just chucks some money in and hopes that the price is going to go up, well I\u2019m sorry, your time is over. <\/p>\n
\u201cThe mindful investor, the one who sees it as a business, enjoys it and wants to really get into it, you know buy a house, do it up, add a bedroom, put a place on the back, really provide a good attractive service for the people that you\u2019re trying to rent to, they\u2019re the ones that are going to be successful.\u201d<\/p>\n
Ball says New Zealand\u2019s 1987 stock market crash offers a relevant history lesson Kiwis should note.<\/p>\n
\u201cUntil recently I didn\u2019t fully understand the extent of how bad the crash was in New Zealand, like our share market went down 50% and never recovered for like almost a decade, whereas other markets overseas had recovered in two or three years.<\/p>\n
\u201cI really do wonder, and we\u2019re probably too early to tell yet, but if the 21\/22 boom and then subsequent bust will have that same psychological effect on today\u2019s generation of investors, that people will no longer automatically look to property as a way of growing their nest egg and will instead look to other investment vehicles.\u201d<\/p>\n
Valocity senior research analyst Wayne Shum told the Herald most of the investor market is made up of people owning up to five properties and more likely just one or two.<\/p>\n
Owners of 10 or more properties are a tiny market segment, Shum says, and for the smaller investor, costs are incentivising divestment.<\/p>\n
When they purchased, interest rates were 2.5%, so they were likely cash positive and even making good equity gains.<\/p>\n
But those rates shot up to 7% and even today at about 5-5.5%, the higher rates make mortgage servicing tough for investors.<\/p>\n
\u201cSo they\u2019ve got to top up and in the meantime they\u2019re paying their own mortgage, the cost of living\u2019s higher, they can\u2019t afford a top-up of $200 a week on a rental.<\/p>\n
\u201cIf they can realise just a small loss or a small gain or breaking even, they will exit the market.\u201d<\/p>\n
Valocity senior research analyst Wayne Shum says more Kiwis are likely diversifying their investments instead of relying on property alone. Photo \/ Mike Scott<\/p>\n
Property company director Tom Rawson believes that even if investors aren\u2019t selling down, they\u2019re making sure their properties are occupied, even if that means forgoing rent increases despite recent high inflation.<\/p>\n
As a leader for Ray White across South and Central Auckland, Rawson oversees a business that includes a division managing 1800 rental properties for about 1500 investors.<\/p>\n
\u201cIt\u2019s real tough. There\u2019s a burden of debt on a lot of people and pay rises aren\u2019t so fluid … it is important to have your property occupied at the moment.\u201d<\/p>\n
He\u2019s been advised against an increase by the property manager of one of his own rentals, even though the rent has been static since 2024.<\/p>\n
\u201cI\u2019m fine with that, happy days \u2013 let\u2019s carry on and kick it down the road for another year and see what happens. I don\u2019t want to lose my tenant.\u201d<\/p>\n
He says \u201call sorts\u201d bought at the peak \u2013 from retirees with a nest egg to developers taking a hiding.<\/p>\n
As a director for Ray White across South and Central Auckland, Tom Rawson has witnessed and personally experienced property investment losses because of the boom and bust cycle of the past six years. Photo \/ Michael Craig<\/p>\n
They may have numerous houses or units they\u2019d intended to sell, but as prices fell off a cliff, they were never going to realise the return needed to avoid a loss.<\/p>\n
\u201cThey can\u2019t afford to sell them at the rate that the current market will allow, so they\u2019ve become accidental landlords and now they\u2019re renting out seven properties so that they\u2019re minimising their losses.\u201d<\/p>\n
Amid the doom and gloom and \u201cdiabolical\u201d stagnation New Zealand has endured, it is hard to be excited, Rawson says.<\/p>\n
But there is an opportunity. House prices in 2026 are similar to pre-Covid and other investment choices are abundant.<\/p>\n
\u201cWe kind of need everyone to be a little bold at the moment and fall in love with New Zealand again, and property again or whatever it might be \u2013 shares, companies.\u201d<\/p>\n
Where have all the property coaches gone?<\/p>\n
Ironically, Emma Hanover used to be homeless.<\/p>\n
At 16, she was forced to leave foster care after quitting school, in part because she believed her dyslexia meant she\u2019d not pass exams, \u201cso what was the point?\u201d<\/p>\n
She already came from a dysfunctional family and severe poverty. Hanover was set adrift, getting high and drunk every day.<\/p>\n
It\u2019s a picture of contrast to a high-achieving businesswoman, married for two decades and the mother of three teenagers.<\/p>\n
\u201cMost people assume I come from money or that daddy gave me whatever I have. It\u2019s absolutely not the case, I\u2019m completely self-made.\u201d<\/p>\n
Hanover does not shy away from her back story and uses it in inspirational messaging for FundHaus and on social media.<\/p>\n
\u201cA lot of people just ask me questions all the time … and I\u2019m giving them free advice and technically teaching them to become my competition, then [I thought], \u2018I probably need to charge for that\u2019. <\/p>\n
\u201cIn doing so I discovered that I actually really enjoy teaching people at this level. I take an individual and I cater the education or consulting to what they need.\u201d<\/p>\n
While Hanover has been trading properties just over two years, the seed for the business was planted during Covid and she has watched the market, including the marketplace of experts, and noticed a decline in their numbers.<\/p>\n
\u201cI think the market\u2019s self-correcting and if you\u2019re dishonest or you don\u2019t really know what you\u2019re doing, then this market\u2019s going to burn you and I think that\u2019s what\u2019s happened.\u201d<\/p>\n
The investors left operating in the current downturn are the good operators, Hanover says.<\/p>\n
\u201cThey\u2019re hard-working Kiwis. Every property investor I know is a hard-working Kiwi, or new Kiwi.\u201d<\/p>\n
Read more in the series<\/p>\n
Monday: \u2018It feels like we stepped into a trap\u2019: Buyers count cost of property slump <\/p>\n
Mike Scott is a senior visual journalist at the New Zealand Herald. His work spans writing, photography and video, and he has won numerous journalism awards, including Videographer of the Year and Best Documentary. He has worked in media for more than 25 years, producing stories across New Zealand and internationally.<\/p>\n