Cairns Lockie Mortgage Commentary
Cairns Lockie Mortgage Commentary
Issue 2005 / 14 12 August 2005
Welcome to the fourteenth Cairns Lockie Mortgage Commentary for 2005. 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 http://www.emortgage.co.nz/newsletters.htm
The Money Market
This evening (4.30 pm on 11 August 2005) the money markets were at the following levels:
Official cash rate 6.75% (unchanged) 90 day bill rate 7.04 (up from 7.02) 1 year swap rate 6.97 (up from 6.96) 3 year swap rate 6.69 (up from 6.60) 10 year bond rate 5.89 (up from 5.75) Kiwi dollar 0.7009 (up from 0.6796)
Where Are The Cheapest Houses?
We normally tell you about new price records (on the high side) but there are towns in this country where houses can be picked up for a song. The Dominion Post recently listed some examples. In most cases they were former mining towns located in the South Island. In Ohai, a former coal mining town, less than an hour's drive from Invercargill, there are currently three houses on the market with prices ranging from $29,000 to $49,000.
Further up the road at Waipahi near Gore, Harcourts Real Estate has a house listed at $29,000. Similarly on the West Coast at Cobden not far from Greymouth, a house is listed for sale at $40,000. Low priced houses are scarcer in the North Island but at Ohura, near Taumarunui in the King Country, a once mining town, now a prison-servicing town which is about to lose its prison, houses can be purchased for under $50,000.
Self Employed - No Problem!
Over the past few years we have been making it easier for the self employed to borrow funds to purchase their own dwellings or to build up a residential property investment portfolio. This group has traditionally found it harder to borrow, than say salary or wage earners, but our "No Financials Home Loan" has made things a lot more straight forward.
Our definition of self employed is fairly wide and includes such people as commission agents and contractors. Our "No Financials Home Loan" has all the features of a normal home loan such as redraws and our parameters are wide - we can go up to 80% of the valuation of the property, plus our single exposure per dwelling has increased to $1.0 million. If you are self employed and require a mortgage, come and talk with us.
Money to Invest
Our subsidiary company, General Finance Limited is taking deposits. Our flagship rate is 9.85% for two years with the minimum deposit being $5,000. Other terms, ranging from 6 months to 5 years are available at different interest rates. For an investment statement and or a prospectus please do not hesitate to call our office on 526 7801 or you can download them at http://www.general.co.nz/prospectus.htm. Current rates are available at http://www.general.co.nz/DepositRates.htm. On the other side General Finance is looking to do first and second residential mortgage advances.
The apartment market continues to be active in Wellington. Over the next three years an estimated 700 new apartments are expecting to be built. This will take the number of apartments in Wellington to around 5,500, well up on 3,000 in the year 2000. One issue facing apartment builders has been escalating construction costs.
These have increased from around $1,200 per square metre to over $2,000 in some cases. This will continue to push up the price of these types of dwellings. It is interesting that the apartment market and apartment living are now permanent features of Wellington City.
Our current mortgage interest rates are as follows
Variable rate 8.65%
No Financials Home Loan 9.25
Jumbo Loan 8.65
Quick Start Home Loan 7.50
One-year fixed rate 7.93 Two-year fixed rate 7.74 Three-year fixed rate 7.54 Five-year fixed rate 7.44
Line of credit facility 8.75