Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Cairns Lockie Mortgage Commentary

Cairns Lockie Mortgage Commentary

Issue 2005 / 19 21 October 2005

Welcome to the nineteenth 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

The Money Market

This morning (8am on 21 October 2005) the money markets were at the
following levels:

Official cash rate 6.75% (unchanged)
90 day bill rate 7.33 (up from 7.21)
1 year swap rate 7.39 (up from 7.24)
3 year swap rate 7.06 (up from 6.95)
10 year bond rate 5.85 (down from 5.87)
Kiwi dollar 0.7000 (up from 0.6976)

Mortgage Rates

Over the past two weeks fixed mortgage rates have increased by around 40
- 50 basis points (around half a percent).This has been caused by the increasing likelihood of the Governor of the Reserve Bank in increasing interest rates. As a home loan lender, active in the housing market, we believe any rise in mortgage rates will harm the economy,
" We are already starting to see a slowdown in the housing market. Today's article in the NZ Herald outlining how it is getting more difficult to sell inner city apartments is an indication to this.
" Landlords are telling us that rents are getting a bit softer.
" Any increase in interest rates may well push up our exchange rate which will hurt our important exporting sector. We certainly share the view of the New Zealand Institute of Economic Research (in the Dominion Post on 12 October) that any rise in interest rates may cause our economy to go into a steep decline, resulting in a hard landing.

Bridging Finance

As we are receiving regular inflows of debenture money into our finance company, General Finance Limited, we are increasing our range of bridging finance options. This type of finance is for short durations - for as little as a few days to up to 12 months. It is ideal for someone who has bought a house but has not sold their existing one, and clearly cannot afford to hold both properties in the medium term. If you require short term finance, for whatever reason, we are happy to talk with you.

Business Borrowing

A number of business people are using their own homes as security for business borrowings. There are a number of advantages in doing this:
" Residential housing finance is the cheapest form of borrowing. Borrowing rates of 7.5% -9.0% are often half the rate which banks or finance companies charge for business borrowings.
" The ability to obtain long periods (5 -10 years) of interest-only funds. Most finance companies require principal repayments along with their interest payments. The principal saved can be put to better use within the business as working capital.
" Structures such as trusts can be developed to quarantine the residential home and the business. Tax benefits may also be available. As a non-bank lender we can assist you with your business finance, using your residential property as security.

Offshore Borrowers

We are seeing a noticeably larger number of offshore buyers purchasing property in this country. The reasons for this are varied but include the absence of capital gains tax on property, high relative yields, and some attractive fundamentals of this country. As a company we are happy to lend to offshore investors. In order to gain quick approvals it is important for borrowers to have all their information available, particularly on their income sources and any cash deposits they may have. One advantage Australians have when they are buying here, is that our lending policies treat Australians exactly the same as New Zealanders.

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 7.90

One-year fixed rate 8.33
Two-year fixed rate 8.04
Three-year fixed rate 7.94
Five-year fixed rate 7.84

Line of credit facility 8.75

William Cairns
James Lockie

Cairns Lockie Limited
321 Great South Road, Greenlane, Auckland
PO Box 74-212, Market Road, Auckland
Telephone (09) 526 2000
Facsimile (09) 579 7795
Email (ddi 09 526
7801) (ddi 09
526 7800) (ddi 09
526 7802) (ddi 09 526
7805) (ddi 09 526
7811) (ddi 09 526
7816) (ddi 09
526 7803) (ddi 09
526 7812) (ddi 09 526
7819) (ddi 09 526
7806) (ddi 09
526 7804) (ddi 09 526
7814) (ddi 09 526
7808) (ddi 09 526
7809) (ddi 09
526 7809) (ddi 09 526
7815) (ddi 09
526 7813)

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

Cairns Lockie Limited is not a Registered Bank.


© Scoop Media

Business Headlines | Sci-Tech Headlines


TradeMe: Property Prices In Every Region Hit New High For The Very First Time

Property prices experienced their hottest month on record in December, with record highs in every region, according to the latest Trade Me Property Price Index.\ Trade Me Property spokesperson Logan Mudge said the property market ended the year with ... More>>

Motor Industry Association: 2020 New Vehicle Registrations Suffer From Covid-19

Chief Executive David Crawford says that like some other sectors of the New Zealand economy, the new vehicle sector suffered from a case of Covid-19. Confirmed figures for December 2020 show registrations of 8,383 were 25% ... More>>

CTU 2021 Work Life Survey: COVID And Bullying Hit Workplaces Hard, Huge Support For Increased Sick Leave

New data from the CTU’s annual work life survey shows a snapshot of working people’s experiences and outlook heading out of 2020 and into the new year. Concerningly 42% of respondents cite workplace bullying as an issue in their workplace - a number ... More>>

Smelter: Tiwai Deal Gives Time For Managed Transition

Today’s deal between Meridian and Rio Tinto for the Tiwai smelter to remain open another four years provides time for a managed transition for Southland. “The deal provides welcome certainty to the Southland community by protecting jobs and incomes as the region plans for the future. The Government is committed to working on a managed transition with the local community,” Grant Robertson said. More>>


OECD: Area Employment Rate Rose By 1.9 Percentage Points In The Third Quarter Of 2020

OECD area employment rate rose by 1.9 percentage points in the third quarter of 2020, but remained 2.5 percentage points below its pre-pandemic level The OECD area [1] employment rate – the share of the working-age population with jobs – rose ... More>>

Economy: Strong Job Ad Performance In Quarter Four

SEEK Quarterly Employment Report data shows a positive q/q performance with a 19% national growth in jobs advertised during Q4 2020, which includes October, November and December. Comparing quarter 4, 2020, with the same quarter in 2019 shows that job ad volumes are 7% lower...More>>

NIWA: 2020 - NZ’s 7th-warmest Year On Record

The nationwide average temperature for 2020, calculated using stations in NIWA’s seven-station temperature series which began in 1909, was 13.24°C (0.63°C above the 1981–2010 annual average). New Zealand’s hottest year on record remains 2016, when... More>>

Quotable Value New Zealand: Property Market Set To Cool From Sizzling To Warm In 2021

Nostradamus himself could not have predicted the strange series of events that befell our world in 2020 – nor the wild trajectory of New Zealand’s property market, which has gone from “doom and gloom” to “boom and Zoom” in record time. Even ... More>>