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

 

Cairns Lockie Mortgage Commentary 22 June 2007

Cairns Lockie Mortgage Commentary

Issue 2007 / 10 22 June 2007

Welcome to the tenth fortnightly Cairns Lockie Mortgage Commentary for 2007. We aim 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 afternoon (3pm on 21 June 2007) the money markets were at the following levels:

Official cash rate 8.00% (unchanged)
90 day bill rate 8.36 (unchanged)
1 year swap rate 8.47 (down from 8.48)
3 year swap rate 8.29 (down from 8.31)
10 year bond rate 6.78 (up from 6.67)
Kiwi dollar 0.7626 (up from 0.7503)


What is Vendor Finance?

Vendor finance is where the owner of the property leaves in some funds, generally by way of a second mortgage for a short period of time - from a few months up to two years. The vendor is normally trying to assist with the selling of the property. The interest rate charged can range from nil% up to 15% but quite often can be at the first mortgage rate. In the past, vendor finance was more common than it is now, due largely to the current buoyant property market where most houses are selling reasonably quickly. It is a useful tool to assist a vendor with a sale, or a purchaser who may find funding a property in the short term a bit more difficult. We expect vendor finance to be used more in the future.


Trust Management

An increasing number of people are using trusts to hold assets. By some estimates there may be 250,000 to 300,000 trusts in existence in this country. One of the most important issues with trusts, is to ensure they are managed in the correct manner. We welcome initiatives in trust education to assist trustees in this regard. Recently an interesting book has been written by Mark Maxwell entitled "Trusts - A Kiwi Sham". The author focuses on getting the management of trusts correct, so that if they are challenged, for example by a creditor or the IRD, they would be able to withstand this challenge. This book is relevant and easy to read. It can be found in most bookshops at $29.55.

Diversify Your Lenders

Financial commentators suggest that share market investors should have diversification in their portfolios. We think that the same should apply to property investors. If you are planning to purchase say four rental properties, it would be advisable to have them all located in different suburbs. The principal of diversification should also apply to your borrowing sources. We see situations where an individual owns a number of rental properties plus their own home and all their borrowings are with the same lender. What happens if that lender, due to changes within the economy or with a different view on New Zealand, changes its lending policy on rental properties or larger exposures? That lender may become increasingly difficult to deal with. One solution is to diversify or increase your number of lenders. It would be wise to consider a non-bank such as Cairns Lockie, that can offer an alternative to your main lender plus some enhanced product features including full redraw facilities and ten years' interest only.

Our Deposit Rates are most attractive.

Our subsidiary company, General Finance Limited, is looking for deposits. It offers a range of terms to investors, ranging from 6 months to 5 years. Our headline rate is for 2 years at 10.15%. There are special rates available for deposits of over $50,000. We use your funds to provide short term bridging types of loans. All loans are secured by way of first or second registered mortgages over residential real estate. We welcome your enquiries and support. Our new prospectus will be available soon. If you would like one, please let us know.


Our current mortgage interest rates are as follows:

Variable rate 9.95%

No Financials Home Loan 10.55

Jumbo Loan 9.95

One-year fixed rate 9.56
Two-year fixed rate 9.40
Three-year fixed rate 9.40
Five-year fixed rate 9.32

Line of credit facility 10.05

Regards
William Cairns
James Lockie

ENDS

Website http://www.emortgage.co.nz

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Reserve Bank: Further Easing In Monetary Policy Delivered

Tēnā koutou katoa, welcome all. The Monetary Policy Committee agreed to expand the Large Scale Asset Purchase (LSAP) programme up to $100 billion so as to further lower retail interest rates in order to achieve its remit. The eligible assets remain ... More>>

Retail: Post-Lockdown Retail Card Spending Picks Up

The rise in retail card spending was boosted by sales of furniture, hardware, and appliances, Stats NZ said today. “For a third consecutive month, card spending on the long-lasting goods (durables) remained at higher levels than last year, after ... More>>


Contact: Business Drops, New Generation On Hold

New Zealand’s second-largest energy company Contact Energy (‘Contact’) released its full year financial results for the 12 months to 30 June 2020 (‘FY20’) this morning. More>>

Mining: OceanaGold Announces Receipt Of WKP Mining Permit

MELBOURNE, Australia, Aug. 6, 2020 /CNW/ - OceanaGold Corporation (TSX: OGC) (ASX: OGC) (the 'Company') is pleased to announce it has received the mining permit for Wharekirauponga ('WKP') on the North Island of New Zealand. ... More>>

ALSO:

Economy: COVID-19 Lockdown Has Widespread Effects On Labour Market

In the June 2020 quarter, the seasonally adjusted unemployment rate fell to 4.0 percent, down from 4.2 percent last quarter, while underutilisation rose, Stats NZ said today. More>>

ALSO:

NZ Post: New Research By NZ Post Shows Online Shopping Grew 105% In Alert Level 3

New research by NZ Post into how the COVID-19 response has impacted the way Kiwis shop online, shows online shopping increased 105%* when the country moved into Alert Level 3, and may have changed the way Kiwis shop permanently. Online spend peaked ... More>>

ALSO:

Antarctica NZ: Ice-Olation

Antarctica New Zealand is gearing up for a much reduced season on the ice this year and a very different deployment to normal! Before they head to one of the remotest places on the planet, all personnel flying south with the New Zealand programme will ... More>>

ALSO:

QV Valuations: July House Price Index Illustrates Market Resilience

According to the July 2020 QV House Price Index (HPI) results out today , property values recorded a marginal increase, up 0.2% over the month. This is somewhat of a turnaround from June, after the national index edged 0.2% lower. More>>

ALSO:

Property: Queenstown Rents Experience Biggest Drop In Seven Years

Rental prices in the Queenstown-Lakes district saw the biggest annual percentage drop in seven years after falling 28 per cent on June last year, according to the latest Trade Me Rental Price Index. Trade Me Property spokesperson Aaron Clancy said ... More>>

Seismology: The Quiet Earth

As many daily activities came to a halt during lockdown, the Earth itself became quiet, probably quieter than it has been since humans developed the technology to listen in. Seismologists have analysed datasets from more than 300 international ... More>>

RNZ: James Shaw Says Kiwibank, Not Ministers Should Decide On Investors

Climate Change Minister James Shaw says Kiwibank's decision to stop doing business with companies dealing in fossil fuels is the right one. More>>

ALSO:

FMA: Kiwis Confident Financial Markets Will Recover From COVID-19, Plan To Increase Investments

Despite the majority (60%) of investors experiencing losses as a result of COVID-19, the outlook on investing remains positive, according to a Financial Markets Authority (FMA) survey. Most Kiwis (71%) were optimistic that the pandemic will pass eventually ... More>>

FIRST Union: Warehouse Using Covid For Cover As Extensive Restructure Makes Everyone Worse Off

(FIRST Union comments on The Warehouse consultation and proposed restructure) 'Unfortunately the Warehouse have done the disappointing thing and used Covid-19 to justify a bunch of operational business decisions that will leave hundreds of workers without jobs ... More>>

ALSO: