Interest rates are at lows not seen since the early 1970s. Rents, particularly in the major cities, are high and are continuing to rise. In many cases, it costs now roughly the same to own a property as it does to rent it. If your income is relatively secure, this is now the time to consider owning your own property. Mortgage rates are low, but if you are worried about them rising and making it harder to meet your repayments, it is now easy to fix them and protect yourself. Many renters complain about the quality of their accommodation. By owning, you can steadily improve your property and this may be reflected, over time, in an increase to the capital values.
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With the Reserve Bank of New Zealand holding the Official Cash Rate (OCR) at 5.5 per cent in October 2023, borrowers are having to get used to higher interest rates and mortgage repayments, as a drop in interest rates this year seems unlikely. For those deciding whether to refix or refinance the mortgage, or for those grappling with a higher cost of living, here are 3 strategies to help reduce the impact of higher interest rates on mortgage repayments.
Earlier this month, the RBNZ increased the Official Cash Rate (OCR) by 50 basis points, from 4.75 per cent to 5.25 per cent. It’s the 11th successive increase and takes the OCR to its highest level since December 2008. As some New Zealand mortgage holders prepare to re-fix their mortgage in the next 6 months, many are likely to see their interest rates double from 3 per cent or less to more than 6 per cent. Before locking in new interest rates, it’s important for borrowers to know these 5 things.
In recent weeks, we’ve seen a flurry of heavily discounted, “under the line” mortgage rates from some New Zealand banks, as they struggle to hit home loan targets in the wake of a floundering property market. As more first home buyers enter the market encouraged by lower house prices, and some existing homeowners near the end of the fixed term portion of their home loan, it’s timely to remind borrowers of the importance of comparing interest rates to ensure you’re getting the most competitive rate available to you.
Mortgage advisers account for close to half of all mortgages written in New Zealand, and it’s not hard to see why. With benefits that include time and money saving, more choice of home loan products, and ongoing guidance even after home loan approval is secured, working with a mortgage adviser can help alleviate a significant amount of stress for borrowers. Read on to find out 10 good reasons to use a mortgage adviser.
Rising interest rates are bad news for first home buyers and borrowers alike, with new homeowners (those who bought homes in the last 18 months) facing much higher mortgage repayments for the first time. With the Reserve Bank of New Zealand signalling further interest rate hikes are on the horizon, how can homeowners avoid placing strain on already tight budgets and stay on top of bigger mortgage repayments? Here are some options.