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Mortgage Advice Blog

Get the latest news and tips about mortgage finance and the property market. Scott Miller, mortgage broker from Advanced Mortgage Solutions comments on housing and lending.

September's Property Gazette

Published by Scott Miller on Friday, September 12, 2014 in

Decisions, decisions, decisions. 

Wouldn't it be great if we knew the perfect thing to do each time we were faced with a major decision that affects our lives!

Just like the looming election where we need to make a choice, at times we feel unprepared to do so and simply therefore, go for what's familiar, comfortable and easy without really investigating the fine print, the big picture or where may find ourselves in a few years. 

Buying a home, business or business premises and borrowing a substantial amount of money is another one of those major decision making processes where having the right knowledge and information can make what can be a stressful time feel much more manageable. 

Traipsing in and out of of financial institutions, comparing products, policy and pricing has never been said to be a quick process let alone an enjoyable one for those on the hunt for a home, yet it's something that simply needs to be done to make sure that your bank's offering is really up with the market and looking after you and that's where we come into play. 

We do the walking, talking, negotiating and sorting for you and after careful analysis based not only on your short term but long term financial goals, we then make the big decisions together that sit and fit well with you going forward. 

Empowering and educating our clients by offering our in depth knowledge of many lending institutions is what we do best. Align this with exceptional service, no cost to you and our friendly down to earth approach we make what many see as a necessary time consuming chore more efficient, time and money saving and definitely tailor made. 

Next time you or someone you know is about to start the journey of finding the right finance, we are the right place to start to make those decisions, decisions, decisions easier. 

Advanced Mortgage & Insurance Solutions - Make a great decision!   

Election Policies for First Home Buyers

With the election looming there has been a lot of commentary on support for first home buyers.  This is developing as a major election issue as the parties strive to capture the younger voter and address the passion we have for home ownership.

National

National says that it backs young Kiwis who are disciplined, save up and want to put a deposit down on a property.  National values home ownership because it provides stability for families, strength for communities and security in retirement.  

Their policy focuses on changes to KiwiSaver.  The First Home Deposit Subsidy would be replaced with a KiwiSaver HomeStart Grant. This is a similar scheme, but has higher house price limits, and doubles the support for people who are buying or building a brand new home.

National will allow people to withdraw more money from their KiwiSaver account to use as a deposit on their first home. First home buyers will be allowed to withdraw the Government’s annual contribution to their account – the member tax credit of up to $521 a year – as well as their own, and their employer’s, contributions.

Finally, more people will be able to get Welcome Home Loans, which means they require only a 10 per cent deposit to get a government-guaranteed loan. This will be achieved by making the Welcome Home Loan house price limits the same as those for the new KiwiSaver HomeStart Grant.

Labour

Labour says it recognises the need to act urgently to address the critical shortage of housing supply and housing affordability. They say there is no single way back to affordability and owning our own future in housing, but turning current trends around and starting down the right track is essential.

They recognise that the biggest barrier to home ownership is the difficulty of getting on the first rungs of the housing ladder. One of the main reasons housing is unaffordable is the lack of new entry-level houses. They quote the 1960s and 1970s, when homeownership was on the rise and 30-35% of the new houses built were entry-level homes. Today, that proportion has fallen to just 5%.

Labour plan to build 100,000 starter homes over 10 years for first home buyers with an emphasis on Christchurch, reform monetary policy to lower interest rates, and crack down on property speculation through a capital gains tax and restrictions on non-resident purchasers of New Zealand houses.  In reforming monetary policy Labour wants to look at ways of introducing long term fixed rate mortgage products.

Minor Parties

The minor parties also have housing policies to encourage home ownership.

The Outcome

Whichever way our parliament is made up after the election, it is good to see that first home affordability is being addressed as a priority.  Let’s hope that the pre election hype turns into policy that can be implemented to make home ownership a realistic goal for first home buyers. 

The Current Market

With the approach of the general election the housing market has adopted a wait and see approach. Potential buyers want to have certainty before committing themselves.

Home values in Auckland, Christchurch and Tauranga are still increasing but at a slower rate than this time last year.  The Auckland region as a whole saw residential property values increase by 1.8% over the past three months. Residential property values in Hamilton City have decreased slightly by 0.2% and over the same period residential property values in the Wellington Region still showed a slight downward trend down 0.5%.

Residential property values in Christchurch City have increased 1.1% over the past three months and in Dunedin City they have decreased slightly by 0.4% over the same period.


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