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Cairns Lockie Mortgage Commentary

Cairns Lockie Mortgage Commentary

Issue 2002/23
Welcome to the twenty-third and last Cairns Lockie Mortgage Commentary for 2002. This is a fortnightly electronic newsletter which aims to keep you informed on developments at Cairns Lockie, Mortgage Bankers and the mortgage market in general. Previous issues of this commentary can be found on our website

The Money Market

This morning (9am on 16 December 2002) the money markets were at the following levels:

Official cash rate 5.75% (unchanged)
90 day bill rate 5.93 (up from 5.91)
1 year swap rate 5.93 (down from 5.94)
3 year swap rate 6.21 (down from 6.22)
10 year bond rate 6.31 (down from 6.38)
Kiwi dollar 0.5143 (up from 0.4948)

A Busy Year For Us

This year has been an exciting one for us at Cairns Lockie Limited. We have enhanced or introduced a number of new products. We have increased our lending margin to 80% for our successful No-Financials product. This has proved to be an ideal product for either the self employed or for recent newer immigrants. We have introduced a Non-Conforming mortgage product, which is aimed at those who have some credit blemishes. These can be a result of a number of factors such as a business failure, matrimonial problems, or other personal financial problems. Our Construction Mortgage has now been introduced. We are starting to write some Second Mortgages and see this increasing next year. Satellite offices have been opened in Cambridge in the Waikato and also in Wellington.

A Mortgage Rate Crystal Ball

2003 - another good year for residential property. Mortgage rates are expected to remain stable and may actual decrease over the coming months. Wholesale mortgage rates are at 60-year lows in the United States and 30-year lows in the United Kingdom, Australia and in this country. With low overseas interest rates, an appreciating Kiwi dollar and our contained inflation, we are expecting NZ rates to decrease by up to half a percent. Immigration remains strong with new immigrants, Kiwis returning home and fewer young New Zealander's going overseas. Tenant demand remains strong and employment levels remain robust. This all looks good for the residential property sector.

Country Lifestyle Beacons

Lifestyle blocks are continuing to be a popular property option in this country, with the benefits of living in a rural setting, in a city type house while working in the city. These types of properties have been good investments as well. The median price for a lifestyle block in Auckland is now $407,500, up 42% in the past five years. A similar pattern exists in Wellington and Christchurch: the median price in Wellington is $255,000 up by 49% and $200,500 in Christchurch up 21% in the past five years. We are noticing a strong interest in these types of properties from borrowers.

Transfer Your Mortgage With Us

There are number of people selling their current property and planning to purchase another. One of the advantages with a mortgage from us, is that your mortgage is transferable. This means you can transfer your existing mortgage to your new property. All you need to do is contact us and discuss what you are proposing to do. We will be back with an answer within 24 hours. When you transfer your mortgage with us, you save money in fees, its quick to do, plus you can continue with your existing lender.

This is our last newsletter for the year. We hope you have found them valuable. We wish all our subscribers a very Merry Christmas and all the best for 2003. Our first newsletter for the New Year will be on 7 February 2003.

Our current mortgage interest rates are as follows

Variable rate 7.50%

No Financials Home Loan 8.50

Jumbo Loan 7.50

Quick Start Home Loan 6.85

One-year fixed rate 7.16

Two-year fixed rate 7.37

Three-year fixed rate 7.49

Five-year fixed rate 7.76

Line of credit facility 7.60

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