Tony Mounce Mortgage Moment - July 2017
Interest rates hold steady
It’s a wonderful opportunity to write another column as the principal sponsor of CPIA. The team and I have attended several forums to date and have had numerous inquiries from CPIA members. We have written a number of like-for-like transfers from banks to enable members to continue to have interest-only loans starting again for another 5 years. As mentioned in a previous column, the existing bank is reluctant to renew the 5 year interest-only period.
Interest rates are quite stable with the OCR remaining unchanged at 1.75% and Australia has also maintained at 1.5%, in contrast to the world central banks’ indication, i.e. USA/Europe who are forecasting an interest rate increase. This has caused NZ swap rates to increase over the last couple of weeks, however, they are only back to where they were in May. Banks are still tweaking rates upwards. This will no doubt continue with volume being down, so margin has to increase.
The New Zealand market is showing signs of slowing and this is good news in a lot of respects as this means the Reserve Bank’s LVR restrictions are starting to work. These rules are a temporary measure so if they continue to work over the next 6 months, there is a definite possibility they may be removed, which would be wonderful news for all of us!
For first time investors, it's good news that owner-occupied, first rental and second rental properties can be financed at Resimac through Tony Mounce Mortgages at 80%, meaning the new investor is not shut out of the market. So if your interest-only periods are coming to an end or you’d like to review your position, get in touch with our team who can negotiate on your behalf to get you a great deal on your home loan.