Market & Portfolio Update - June 2021
Returns on overseas investments were supported by the New Zealand dollar falling against most major currencies during the month. The US dollar strengthened by 4% in June after the Federal Reserve brought forward their expectation for hikes in the Fed Funds Rate from 2024 to 2023. Given the strength of the economic data so far this year, there is a possibility this could be brought forward again.
Global share markets were up over 2% for the month in their home currency terms, and almost 6% in NZD terms (due to the weaker NZ dollar). Pleasingly, both our active global share managers delivered significantly higher returns, with California-based Fisher investments, benefiting from their exposure to the technology sector.
The New Zealand and Australian share markets also produced solid returns for the month, although were both relatively quiet on the news front. Many of the higher growth companies were back in favour during June, with their valuations being supported by longer-term interest rates falling back a little after rising in the first part of the year.
What could Capital Gains Tax mean for property investors?
If Capital Gains Tax (CGT) is introduced from 1 July 2027 under Labour’s proposal, property investors will naturally want to understand what it could mean for them, particularly if they already own property that has increased significantly in value.
Selling a short-term rental: Will GST apply?
In certain circumstances, GST is not due on the sale of a property, even if it has been used for short-term accommodation (such as Airbnb), the income has exceeded $60,000 in any 12-month period, and/or the entity is GST registered.