We declare a new mortgage war and ask; will the NZ market follow Australia’s slide?
A major bank just announced a property loan rate below 4%. Is this the first salvo in a new mortgage war? Sure sounds like it! We’re never sure how long rates will stay down for so if your clients are looking to alter their mortgage in the next 60 days, I can have a chat to them and see if locking in a rate is the right thing for them. And if they’re due to end a fixed term in the next six to nine months they may want to weigh up the cost of breaking their mortgage to re-fix it at a lower rate.
And, now to whether the NZ market will follow Australia’s slide. CoreLogic says no. Here’s their reasons:
We don’t have a general oversupply of property. Just look at Auckland! Surplus apartments in Sydney and Melbourne drag prices down.
Unlike other nations, our mortgage rates aren’t rising, and may even drop due to the “rate war” reported above.
Australia’s regulators haven’t been as active as ours in curbing risky lending. We’ve had loan-to-value restrictions for about five years and control interest-only loans far more tightly.
If any of your clients are thinking of refinancing, or need help looking for a property loan, feel free to get in touch!