Reserve Bank Governor Alan Bollard said: “Inflation is restrained and is expected to stay near the middle of the Bank’s target range.

“The domestic economy is showing signs of recovery. Housing market activity continues to increase and a recovery in building activity appears to be underway, as forecast. That recovery will strengthen as repairs and reconstruction in Canterbury pick up later in the year.

“However, the global outlook remains of concern. Near-term indicators have moderated and financial market sentiment is still fragile.

“The New Zealand dollar has stayed elevated despite recent falls in commodity prices. Should the exchange rate remain strong without anything else changing, the Bank would need to reassess the outlook for monetary policy settings.

“For now, it is appropriate for the OCR to remain at 2.5 percent.”

Mike Hannah – RBNZ

At Loan Market we are pleased to announce that we have recently commenced a relationship with NZForex – a global foreign exchange specialist.  Many of our clients are simply unaware of the high margins and fees that are applied by the Banks for International transactions.

This has prompted the Loan Market Group to partner with NZForex, on behalf of our clients we have negotiated rates of exchange which will not be beaten, and the difference in rates may even be in the thousands of dollars.

The savings for the smaller transfers soon add up if you are making regular payments, and NZForex have waived all transfer fees for Loan Market clients.

NZForex can also provide you with advice & hedging tools in order to assist you in managing the volatility of the foreign exchange market.

Here are some frequently asked questions:

What are the benefits of using NZForex?

• Zero transaction fees;
• No receiving bank fees in most countries;
• Extremely competitive foreign exchange rates across 52 currencies;
• Online access 24/7;
• Access to a dedicated dealer by phone 24-hours a day, 5 days a week;
• Complete exchange rate transparency;
• Risk management tools through Limit Orders and Forward Exchange Contracts;
• Exchange rate alerts via email;
• Access to their highly regarded daily and weekly ‘Market Commentary’.

What can I use NZForex for?

• Paying international invoices;
• Paying for loans, investments, school fees abroad;
• Transferring money to family members;
• Transferring pensions;
• Corporate or Business transactions;
• Purchasing property internationally;
• Any other International requirement you may have.

In following editions of The Insider, look out for articles about the volatility of foreign markets, when to hedge, other NZForex services such as limit orders-forward contracts-rate alerts and much more!

For more information on how to register free for a no obligation quote or for more information, talk to me today.

NZForex

The first is the presentation of your home you don’t have to spend a great deal of time or money to make sure your home look its best. A fresh coat of paint, well-tended gardens, minor repairs, professional cleaning and de-cluttering will make a big difference to buyers’ first impression.

Properties for sale are often dressed up when available to be shown, it just gives the viewer an appreciation of the lifestyle it offers rather than empty rooms left to be filled by imagination.

Professional styling is one way to achieve this and can be particularly beneficial for vacant properties to make them appear more homely and functional.

There’s no shortage of ways to present your property in its best light and maximise your selling price. And the appearance of the property is as important as choosing the person to put in control of its marketing and eventual sale.

The good real-estate agent will advise the best time of year to sell your property as well as the best method of sale: private treaty, auction and public tender are the most frequent used options.

Each has its advantages for certain properties and in certain markets. An agent will recommend a sales method they feel is most conducive to achieving the highest possible price for your property.

When it comes to advertising your property to potential buyers, the aim is to expose it to as many as possible and create competition, and as a result, increase the sale price.

Finally, you should detail all the benefits and attributes of your property up-front. As an owner it is important to detail all of the inclusions or exclusions so that buyers know exactly what’s included in the sale, whether its light-fittings or pool equipment, all the add-ons need to be promoted and clearly stated in order to achieve a smooth sales result.

In truth, none of these are particularly good. Virtually all stocks today, even those from health-food stores, contain yeast extract, a source of MSG. Many have other glutamates, added colours and are loaded with salt.

What’s good?

• Frozen home-made stock available from delis and some health-food stores;

• Fish Stock – due to the naturally salty flavour of fish, cartons of fish stock are free of all free glutamates and lower in salt than many commercial chicken and beef stocks.

What’s not so good?

• Anything with sea salt as the first listed ingredient;

• Anything with yeast extract and/or MSG or MSG derivates;

• Anything with the colour caramel 150d.

What to look for:

• Try to avoid MSG, free glutamate and other glutamates used as flavour enhancers (these include 620, 621, 622, 623, 624, 625, 627, 631, 635 and monosodium glutamate, yeast extract and anything that starts with the word ‘hydrolysed’, including hydrolysed vegetable protein, hydrolysed plant protein and hydrolysed protein);

• Avoid preservatives (in particular 220);

• Check salt content per serve (sodium);

• Check sugar content per serve;

• Look out for nitrates – these are added to processed meat as colours, flavours and preservatives.

A good, hearty soup is cheap, nutritious and makes an extremely satisfying meal. Another bonus is that it tastes even better on the second and third days after making it, and if you make too much it can be frozen. Pureed, it’s a great way to provide children and the elderly with extra nutrients when their appetites are diminished, but most importantly do like they did in the old days and try your hand at making your own stock. It may take longer, but taking time out of the equation, as well as being much healthier, it’s a much cheaper option.

Judy Davy – The Food Coach

Reserve Bank Governor Alan Bollard said: “Inflation has settled near the middle of the Bank’s target range, and inflation expectations have fallen.

“The domestic economy is showing signs of recovery. Household spending appears to have picked up over the past few months and a recovery in building activity appears to be underway. That recovery will strengthen as repairs and reconstruction in Canterbury pick up later in the year. High export commodity prices are also helping to support a continuing recovery in domestic activity.

“Policy actions from a number of central banks have boosted global confidence. While encouraging, financial market sentiment remains fragile and risks to the global outlook remain. Furthermore, the easing in global monetary policy and resultant recovery in risk appetite has contributed to a marked appreciation in theNew Zealand dollar.

“While helping contain inflation, the high value of the New Zealand dollar is detrimental to the tradable sector, undermines GDP growth and inhibits rebalancing in the New Zealand economy.  Sustained strength in the New Zealand dollar would reduce the need for future increases in the OCR.

“Given the medium-term outlook for inflation, it remains prudent to hold the OCR at 2.5 percent.”

RBNZ Media Contact Mike Hannah

TV images of an auctioneer waving a hammer around and calling out excitedly, taking bids from people you didn’t even see move don’t necessarily make it look easy. But as with many things in life, it’s likely you have a fear of the unknown, rather than a specific fear of the auction process.

Auction sceptical vendors often cite the pressure of auction day or a fear of not getting the best price as reasons to avoid selling via auction.

Auction-averse buyers may be intimidated by the process, fearing the bidding will be too fast or that they may pay too much. But Mark says the real key to a successful auction outcome whether you’re a buyer or a seller is to understand the process.

When it comes to price, the whole premise behind the auction mode of selling is to find the current market’s best price in the most transparent way.

It’s a common fallacy that the real estate agent’s job in auctioning a property is to sell it for a particular price. In reality, the real role of an agent is to market the auction property in such a way that all active buyers in the marketplace are made aware of the sale and come prepared to bid to their highest limit on auction day.

The basic economic principle of supply and demand will then decide the outcome.

Once you’ve become attached or accustomed to the way your home or second property looks it can be hard to stop and think. It’s a commodity I want it gone for the highest price.

Just because you think your place is perfect or can’t see its faults or untapped street appeal potential the way a buyer or renter will, it doesn’t mean you should shrug your shoulders and give up.

Next time you arrive, slow down and do a drive by. Approach your property from both directions plus the back if you have two street access. Stop across the road and do the following street appeal exercise jotting down the answers to these questions:

• What is your first impression of the house?
• If the house isn’t visible from the street, how does the front of the block look?
• What are the best features of the property?
• What are the worst features of the property?

Now park in a place a potential buyer is most likely to pull up and walk towards the house. Note down your answers to the following questions:

• Is the pedestrian approach to the house clearly defined?
• Is the gate easy to find and open?
• How obvious and inviting is the front door?

If you’re still struggling to be objective opt to get an impartial professional opinion or take photos from various places in the street. Looking at an image especially in black and white can make features and faults more apparent.

Carry out your street appeal exercise again in the evening at dusk and in the dark. It wouldn’t be unusual for potential purchasers or tenants to check out a property on their way home or together in the evening.

Make a list of the problems and positives you’ve discovered. Then make a second list to prioritize the clean-up and repairs before moving on to new improvements.

If you’re tempted to skip or skim on improving street appeal remember, humans by nature are quick to judge and slow to change our minds. Your efforts will pay dividends in creating a great first impression. There is no second chance to do that.

Alex Honey – Sterling Interiors

This was a conversation I had with a group of friends over breakfast yesterday. After some angst and deliberation these were my three:

• Eat five serves of vegetables a day
• Cut out all soft drinks and diet soft drinks altogether
• Cut out all white processed carbohydrates

When I asked Naturopath Lisa Costa-Bir what her three rules would be, she, like I had done the day before struggled with her list. After great debate she came up with her list:

• Drink enough water each day so your urine is clear and not smelly
• Eat foods that looks as close to their natural state as possible i.e. wholefoods
• Eat at least five serves of various seasonal vegetables in season a day

Dr Joanna McMillan had similar issues narrowing down her three but finally came up these:

• Minimise the amount of processed carbohydrates in your diet
• Fill half your plate with veggies at lunch and dinner
• Never drink soft drinks

We each know our own bodies, and what works and what doesn’t, and most importantly what tips are realistic enough to stick too.

Combine some of these tips with a healthy eating plan. You will find these especially useful going into a cold and wet winter when comfort food may be hard to resist.

Judy Davie – The Food Coach

Different countries use different methodologies and data sources, meaning – in some cases – care needs to be taken when comparing economic statistics, Dr Bollard told a meeting of the Trans Tasman Business Circle in Auckland.

He said the Reserve Bank believed that if consistent measurement conventions were used, the income gap between New Zealand and Australia and other OECD countries would narrow.

“Our view is that in New Zealand, some conservative statistical interpretations and particular characteristics of our economy have resulted in the understatement of New Zealand’s economic performance. In international league tables New Zealand is in some ways better off than is often thought.”

The Reserve Bank has explored differences in the way gross domestic product (GDP) is measured in Australia and New Zealand. Allowing for these differences, our GDP could be significantly higher relative to other countries than currently measured. A very rough, broad, ballpark might put this up to 10 percent higher than official data, compared with Australia.

“These are not definitive numbers, and we accept there are counter-arguments to them.”

Revising New Zealand’s GDP does not lift actual incomes or purchasing power for New Zealanders, or raise tax revenues for the government, Dr Bollard said. “We cannot make ourselves better off directly just by measuring things differently.”

But more comparable data is important to ensure individuals make well-informed decisions about training, migration and saving, and that financial markets have accurate measures of New Zealand’s ability to borrow and repay debt.

Governments also need good data to ensure well-informed social and economic policy, and to understand comparability with other countries, including that of our large trans-Tasman neighbour.

Dr Bollard said the Reserve Bank’s analysis did not answer the question of whether New Zealand was closing the trans-Tasman gap. “However, it does argue that the gap is not as wide as most people think.”

He noted that the Prime Ministers of Australia and New Zealand recently agreed that their respective Productivity Commissions would look at reforms aimed at increasing economic integration between the two countries.

“Given this aim, a useful contribution could be to improve harmonisation of statistical measurement in Australia and New Zealand, where appropriate, to improve data comparability.”

He said problems with the comparability of statistics were an international issue, and his comments were not a criticism of Statistics New Zealand. Rather they were aimed at making people aware of the issues, and encouraging a greater priority being placed on improving New Zealand’s economic statistics.

Dr Bollard said he was aware that, in the area of GDP, Statistics NZ has plans in place to increase the ease of comparability of data with Australia.

Organisations like the United Nations and International Monetary Fund were working to make economic statistics more comparable. But for the time being there were pitfalls in making international comparisons.

“As usual, the devil is in the detail. Compare with care.”

Media Release, Reserve Bank of New Zealand – Mike Hannah

Tip 1: Get a home loan with a flexible payment structure

Before you sign on your home loan, find out if you can make increased regular payments and lump sum repayments without incurring a penalty. Also be aware that these extra features will incur additional costs. Get a good mortgage broker to weigh up the pros and cons on your behalf.

Tip 2: Make extra repayments as early as possible

Most people don’t realise that the majority of the payments made at the beginning of a home loan actually go towards paying off interest and not reducing the principal. Therefore any extra payments that you make from the very beginning go towards reducing your principal and minimising interest payments down the track.

Tip 3: Make your first mortgage payment on settlement date

This is yet another excellent example of how making early payments can reduce your principal and future interest repayments.

Tip 4: Make more frequent repayments

Where interest is calculated on a daily basis, making payments on a more frequent basis whether fortnightly or weekly serves to cut down on your interest payments

For example, making fortnightly repayments means that you’ll be making 13 monthly repayments each year, thereby reducing the principal and term of your loan.

Tip 5: Paying income directly into your home loan

As interest is calculated daily, getting your salary direct to your home loan account effectively reduces the principal you owe from the moment your salary is in the account, this is in turn reduces the interest.

If you have any questions about your home loan or are concerned about interest rate changes talk to your expert mortgage broker today.

Loan Market Group