Issue 2017 / 16 8 September 2017
Welcome to the sixteenth fortnightly General Finance Mortgage Commentary for 2017. We aim to keep you informed on developments at General Finance Home Loans and the mortgage market in general.
The Money Market
This morning (9 am on 8 September 2017) the money markets were at the following levels:
Official cash rate 1.75% (unchanged)
90 day bill rate 1.95 (unchanged)
1 year swap rate 1.99 (down from 2.01)
3 year swap rate 2.27 (down from 2.35)
10 year bond rate 2.76 (down from 2.90)
NZ/US dollar 0.7233 (up from 0.7200)
How Important is Fibre?
Overseas evidence suggests that a dwelling that is connected to ultra fast broadband will sell for slightly more and it will be easier to let. So far, in New Zealand, this does not appear to be the case but it may change. As more people work from home and as there is more streaming of things (such as movies), having fast broadband will become increasingly more important. Having fast broadband available on a rental property will likely make economic sense, but it will be up to the landlord to decide whether to make this investment.
Ready to Rent Programme
The Hawke’s Bay Health Board has initiated a training programme called the “Ready to Rent Programme”. This programme provides tenants and potential tenants, over two class room sessions, information about their rights and responsibilities as tenants, as well as other subjects such as how to best heat your home. First time tenants often find it hard to rent a property, as they do not have any references. The Hawke’s Bay Property Investors Association has wisely come out to support the scheme. We believe this is a good idea.
Buying a House is Getting More Complex
It is becoming increasingly more complex to purchase a residential property. There is now considerably more disclosure required from real estate companies marketing properties. Potential buyers need to consider whether they should obtain a weather tightness report, particularly if the property was built post 1990. It is probably a good idea to test your proposed purchase for P. Houses in all areas and price brackets have been found to have been contaminated with this dreadful substance. If you are buying in an earthquake prone area, such as greater Christchurch or Wellington, some checking is required as to what your obligations may be for the strengthening of your property. Your insurance company can assist here. Adequate due diligence is becoming a must, even when you are purchasing a residential home. Failure to do this can cost you thousands of dollars in a worse case scenario.
Great Deposit Rates
We continue to offer attractive interest rates on our term deposits. Our two year rate is 5.50% and three year rate is 5.75%. We can pay interest either monthly or quarterly. Or interest can be compounded on a quarterly basis. All deposits are secured under our debenture trust deed. Just compare our rates, to what other deposit taking institutions are offering.
Mortgage Interest Rates
For updated mortgage interest rates, either for new business or applicable to your existing loan, please contact your Lender (below) or the General Finance Limited Loan Administration Department.
As everyone's personal circumstances are different and the tax treatment of their affairs is always determined by their own circumstances, you should not act on any comments made in our Commentary without obtaining your own independent professional advice.
General Finance Limited is a Registered Financial Services Provider, with registration number FSP8882.