Australia, last week, lowered its overnight cash rate and mortgage decreases followed. Our Reserve Bank has stated that our exchange rate is too high, our Government will not meet their fiscal targets, inflation is subdued and our unemployment is slowly rising. As we have stated previously, our Reserve Bank should decrease interest rates further, which would assist those with mortgages, as well as the export sector via a lower exchange rate. This is unlikely to ignite the housing market. A small portion of the market is active and appreciating, but this is confined to the inner Auckland suburbs. The rest of the country can only be described as stable. Christchurch is a bit of an exception. Let’s hope our Reserve Bank follows their Australian counterpart.
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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.