Interest Rates

[Maccachic]

Hit up BNZ and got 4.99% for 5 years

[Cpt707]

..if inflation takes off you will be smiling....if Deflation arrives for the next decade...not so good....Who would Know..??

[Bluekiwi]

Hit up BNZ and got 4.99% for 5 years

I am very impressed.
Envious almost.

[donthatetheplayer]

Hit up BNZ and got 4.99% for 5 years

Great to see. Well done!

[Maccachic]

..if inflation takes off you will be smiling....if Deflation arrives for the next decade...not so good....Who would Know..??

My crystal balls work for me and I'll stand by my decision either way

[Commercial Dan]

Big thing will be interest rates, at some point within 2-3 years we will HAVE to cut them again, would be interested to hear everyone's strategy. Borrow more, less? Pay off more debt, box with caution? The world is in some serious crap if they have to cut rates again and again, not much room to go till zero, deflation and then a depression. In Germany, Sweden and Denmark interest rates for bank deposits are negative. Where will property go?

[BigDreamer]

Out of interest, for the brokermen on here; Do rates that maybe offered vary depending on location, or is it more to do with the applicant? e.g. Is it likely that, all other things being equal, a bank will offer better packages and incentives for a borrower buying Auckland, as opposed to Christchurch, Wellington, or elsewhere?

Cheers

I have actually always wondered that as well. I have been tempted to go to branch local to where I'm buying as I truly believe I will get a better offer and experience than walking into the same bank's Auckland branch.

My theory is mostly about smaller towns and I *think* (theory yet to be tested) I can obtain a loan easier from the local branch than from an Auckland branch.

I'm curious to hear what others think.

[BigDreamer]

Extremely impressive. I am assuming no cash contribution in order to match TSB, right?

Regardless, a great rate.

[mrsaneperson]

Big thing will be interest rates, at some point within 2-3 years we will HAVE to cut them again, would be interested to hear everyone's strategy. Borrow more, less? Pay off more debt, box with caution? The world is in some serious crap if they have to cut rates again and again, not much room to go till zero, deflation and then a depression. In Germany, Sweden and Denmark interest rates for bank deposits are negative. Where will property go?

Negative interest rates ? How does that work out?
That seems the end of trust in banks i guess and the collapse of the worlds entire financial system.

[Bluekiwi]

Big thing will be interest rates, at some point within 2-3 years we will HAVE to cut them again, would be interested to hear everyone's strategy. Borrow more, less? Pay off more debt, box with caution? The world is in some serious crap if they have to cut rates again and again, not much room to go till zero, deflation and then a depression. In Germany, Sweden and Denmark interest rates for bank deposits are negative. Where will property go?

Todays property investor needs to be a macro economist with an active eye on the global financial scene.
Things move incredibly fast now adays, my property plans are constantly changing, and people need to review where they are trying to get to, where they are now, and how they intend to get to where they want to be.

Lower interest rates are currently great for investors, and spinnig property prices higher in NZ, mainly auckland obviously.
Making capital gains and minimising interest cost, within your individual property strategy is great, at the moment.

There is no doubt, at some point in time, this will change, just a question of when.
If you can ride this wave, and then reduce debt, maybe quit some property towards the end of it.
And arrive at "Doomsday" for a better word for it, with possibly deflation, or falling property prices or whatever.
You can then fall back on what is hopefully a smaller portfolio, with less debt, and higher nett yields.

So that you are in fact, in a strong position no matter what is thrown at you.
And you have a portfolio that is strong and you can pass on to your children.

Timing is everything.
I am picking 2017 to 2018 for Auckland / NZ.
Tony A's personal thoughts are 2018.

Unitary Plan comes in 2017, and give it a year to ramp up into greater section supply and building.
Plus the SHA's start to actually produce real housing units that people can move into.
Ausie picks up again.

But deep down I feel Auckland / NZ property has potential to go strong well into mid this century.
World wide instability looks to me to be rising, international terrorism in its infancy.
Its not rocket science where the safest country at the bottom of the world is.

[speights boy]

But first, just released minutes from the US Fed show that officials there acknowledge international risks to the US economy and the weak start to the year domestically but are still confident enough in the strength of the US recovery to plan for an interest rate hike later this year.

In fact, some Fed officials still see a June hike as possible.

http://www.interest.co.nz/news/74899/us-fed-track-rate-hikes-negative-yields-euroland-mexicos-century-bond-ato-audits-tech-mul

[Perry]

Poor Take-Up of Long Term Mortgages
12 April 2015

Homebuyers want 30-year mortgages, but are reluctant to sign up for
longer-term fixed rate mortgage loans, new Reserve Bank figures show.
While both the Bank of New Zealand and TSB are offering fixed interest
rates for seven and 10 years respectively, Reserve Bank figures show
mortgage loans fixed for five years or more account for just 0.02 per
cent of the $200,154 million of home loans currently outstanding.

More than half of all bank mortgages are for 30-year terms, but many
borrowers, as their finances improve, pay off the loans faster.
Interest rates for the loans were mostly on one or two year terms. The
reluctance of Kiwi mortgage takers to commit to longer term fixed rate
mortgages was partly a hangover of the 2009 Global Financial Crisis,
according to Massey University's Professor David Tripe.

[Toasty]

http://www.wsj.com/articles/as-interest-benchmarks-go-negative-banks-may-have-to-pay-borrowers-1428939338

Strange times in Europe.

[Wayne]

amazing - get paid to owe money. I dream of this.

[Perry]

Banks paying people to borrow money from them?
Roll on that particular euro-disease in lil ol NZ.

Maybe PIs could be asking for bank managers to
provide a statement of position and credit history?