Cairns Lockie Mortgage Commentary 1 July 2005

Cairns Lockie Mortgage Commentary

1 July 2005

Welcome to the eleventh 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 30 June 2005) the money markets were at the following levels:

Official cash rate 6.75% (unchanged) 90 day bill rate 7.03 (down from 7.04) 1 year swap rate 6.96 (down from 7.03) 3 year swap rate 6.59 (down from 6.74) 10 year bond rate 5.71 (down from 5.81) Kiwi dollar 0.7010 (down from 0.7110)

Certificates of Acceptance

The Building Act 2004 introduced a number of new provisions, many of which came into force on 31 March 2005 including Certificates of Acceptance. They provide a means of retrospectively approving unconsented building work, or work certified by a private certifier that has exited the market before code of compliance certificates could be issued. A certificate of acceptance states that, to the extent an inspection was able to be carried out, the work is compliant with the Building Code. There are a number of other changes to the building consent and inspection process.

TradeMe Property is Hot

Currently with 2,142 listings TradeMe Property is the latest destination for property searchers on the internet. Launched earlier this month the site charges sellers a once-only flat fee of $49.95 (including GST) for a listing and photographs. Check it out at http://www.trademe.co.nz/Trade-Me-Property/. Landlords can also use the TradeMe Letting site at http://www.trademe.co.nz/structure/rentals/ currently with over 500 properties to let. The Real Estate Institute of New Zealand also has a pretty good site for buyers at http://www.realenz.co.nz/ with over 60,000 listings.

Second Mortgages Finding a Niche

Our associate, General Finance Limited, is writing a number of second mortgages to assist borrowers with short term needs. In a recent example a borrower was preparing their property for sale and required an additional $40,000. As they required the advance for only 3-4 months, they came to us for a second mortgage rather than their existing bankers (as banks prefer longer term loans). They also required the funds quickly in order to purchase building materials and whiteware that were on special. Four months later our loan was repaid. If you have a similar need, give us a call.

New High for Kapiti Coast Property

The Dominion Post recently reported the sale of a Waikanae coastal property for $1.35 million, a new high. It was described as a unique, absolute beachfront entertainer's paradise. It featured a heated outdoor swimming pool, indoor and outdoor sound system and three car garaging. The property, at the north end of Waikanae Beach, sold to a Wellington buyer.

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 7.89 Three-year fixed rate 7.54 Five-year fixed rate 7.44

Line of credit facility 8.75

ENDS

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