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Cairns Lockie Mortgage Commentary – 17 Sept

Issue 17
17 September 1999

Welcome to the seventeenth issue of the Cairns Lockie Mortgage Commentary. 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 (8am on 17 September) the money markets are at the following levels:

Official cash rate - 4.50%
90 day bill - 5.01
1 year swap rate - 5.99
3 year swap rate - 7.17
10 year bond - 6.90
Kiwi dollar - 0.5235

Mortgage Rates - We Are in Normal Circumstances!

Continuing from the comments in our last newsletter, a number of people have been saying to us "Why have all the fixed rates gone up but not the floating rates?" The answer is straightforward. In a relatively free money market, there should exist, what economists call, a positive yield curve. The longer you tie up your money for, the higher the rate you should earn. Investors need to be encouraged to invest for longer periods and compensated for the greater credit risk inherent in longer dated commitments. We have a relatively free capital market and a positive yield curve, hence floating rates will be lower than the fixed rates.

More Advances on our Website at

Not only do we update out website frequently, we are constantly aiming to improving it by providing more useful information. Our latest change is to include comparative interest rates offered by trading banks. In virtually all cases, it is better to go to a specialist mortgage banker such as Cairns Lockie Limited. Visit the site at

What People are Doing in the Capital

Following conversations with various valuers and house purchasers, we seem to be noticing a trend among some Wellington people, in purchasing property in the Wairarapa. For years this part of the country was clearly out of fashion, but as more people start enjoying the fine wines from the region, a number want to live there as well. Those that have moved tell us the climate is better, the lifestyle more laid back and the drive over the Rimutaka's is not that bad after all.

Buying Property in Australia?

Are you thinking of purchasing a property in Australia? Although we do not have an office there, we have numerous contacts that will be able to assist you. Not only with financing but also with the more general issues of capital gains tax, stamp duty, negative gearing and so forth. If you are thinking of purchasing, please do not hesitate to contact us.

Auckland Collier Hockey Update

Our Auckland team is building up well for its Timaru matches the weekend after next. The team has had good wins against Bay of Plenty, North Harbour A, and Tauranga. A couple of surprise losses have focused resolve for the tournament. Good luck for the Trophy.

Our current interest rates are as follows

Variable rate 5.85%

Two-year fixed rate 7.80
Three-year fixed rate 8.30
Five-year fixed rate 8.75

Line of credit facility 6.25
Equity accelerator 6.25


William Cairns
James Lockie
Glyn Slade
Scott Gasson

Cairns Lockie Limited PO Box 74-212, Market Road, Auckland Telephone (09) 525 9711 Facsimile (09) 579 7795 Website

If you know anyone who may find this newsletter useful we would be happy for you to forward it on.


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