Mortgage brokers are pointing to early signs of the major banks opening the door to more low-deposit borrowers in the wake of an easing in home-loan restrictions.
On January 1 the Reserve Bank increased the cap on banks from 10 per cent to 15 per cent of lending to home buyers with a deposit of less than 20 per cent. Investors also received a slight reprieve with the equity requirements reducing from 40 per cent to 35 per cent with 5 per cent of lending to investors allowed outside of that.
John Bolton, managing director of Squirrel Mortgages, said he had noticed two big changes since the lending restrictions on the banks were eased. "One - everyone is open. Last year for periods it was just really hard to do anything."
Last year brokers reported having to go from bank to bank to see who had the capacity to lend with it changing on a weekly basis depending on what lending they had approved.
Bolton said the cap increase from 10 to 15 per cent was not huge but it did alleviate capacity issues. Bolton also said the second change he had noticed was an increase in interest from first-home buyers.
"There is a lot of enquiry around at the moment. We are looking at a lot of applications in that over 80 per cent space."
Government is extending the amount of time for which investment properties must be held before their owners can avoid capital gains tax - despite a warning that it could be bad news for renters. Revenue Minister Stuart Nash confirmed the "bright-line" test would be extended from two years to five in legislation working through Parliament.
"The extension of the previous government's bright-line test will help dampen property speculation and make homes more affordable," Nash said.He said reducing speculative demand would help to improve affordability for owner-occupiers.
But in an impact assessment, Inland Revenue and Treasury officials warned there was a risk of "lock-in" as a result of the change, which could reduce the number of dwellings for sale. "If the fall in the number of dwellings for sale exceeds the reduced demand from speculators and investors then this could lead to increased competition for the housing stock available for purchase for a period of time."
They said there was a risk that rents could rise if the law change reduced the number of investors buying and renting out property. "A higher level of home-ownership among former renters is unlikely to completely offset the pressure on rental prices. This is because owner-occupied homes typically have a lower occupancy rate than rental homes, so the reduction in the supply of rental housing (caused by some investors exiting the market) will probably outweigh the reduction in demand for rentals (as some renters purchase homes)."
Gareth Kiernan, chief forecaster at Infometrics, said the rule change would make a difference. A two-year limit would stop people who were flicking properties on in a speculative boom, but two years was not a long time to have to plan to hold a property. "With five years, that's quite a long-term decision you're making there."
Cameron Bagrie, of Bagrie Economics, said it should be seen in the context of wider structural changes to the market as the Government changed migration settings, reassessed the tax system, and pushed ahead with its building project KiwiBuild, as the banks' attitude to lending changed. "There's a lot of uncertainty in regard to how that's going to impact the market."
The extension from two to five years would make a difference, he said, but it had to be seen in context.
For more than 30 years Twiss-Keir Realty has worked alongside, and invested in, the Canterbury community, successfully negotiating tens of thousands of sales for its clients. Little wonder it is known as your home for local property. Harcourts Twiss-Keir Realty, have offices strategically located in Belfast, Hanmer Springs, Hornby, Kaiapoi, Rangiora, Rolleston and The Palms.
As experienced negotiators, you may be surprised to know that for us there are some things that are never negotiable and that’s because our success is down to our commitment to a few very simple rules.
We are also unique in having experts in a wide range of specific property types through Harcourts Developments – a specifically designed service that specialises in marketing larger and more complex property projects.
So whether you’re developing a subdivision, looking to market your viticulture business, sell the farm or sell or lease a commercial proposition, we have the experts to make it happen.
Twiss-Keir does specific, not generic, so positioning your property so it lands exactly in front of your target market is the job of our marketing department, offering tailored marketing options that maximise the unique attributes to get the outstanding result we both want and expect.
When you need good people getting good results then it’s time to talk to us.
Phone 0800 789 1011 or visit our website www.twisskeir.co.nz.
Our summer began with a record setting dry spell, the start to the New Year has been somewhat more variable, this changeable weather has brought the much needed moisture to grow our crops, feed and grass here in Canterbury, often change can bring about beneficial consequences.
We’ve had our own change recently with the ownership of Harcourts Four Seasons Franchise transferring to the owners of the Harcourts Twiss-Keir Franchise, resulting in consistent ownership throughout the rural districts of Selwyn, Waimakariri and Hurunui. This consistency further enhances our ability to provide the very best Real Estate advice and service by ensuring a solid foundation and coherent commitment to the Canterbury sector.
The acquisition of the Hornby and Rolleston Offices was an obvious one for Twiss-Keir Realty, with both teams having similar cultures and strong focus on the rural lifestyle sector, residential and commercial markets and Property Management in the Canterbury area. Our clients will now have the combined expertise of over 90 local salespeople across the region to assist in selling your properties.
It is an exciting time for the Twiss-Keir/Four Seasons businesses and we look forward to helping clients in their real estate dreams.
Picture: Ross Mitchell Branch Manager Rolleston Office & James Twiss Business owner and Branch Manager Hornby Office.
As a team of professional marketing and negotiating consultants we are committed to excellence in service and results. Our sales consultants live locally and have a great deal of knowledge and enthusiasm for their community.
Call Harcourts Twiss-Keir Realty and experience the difference! 0800 789 1011 | twisskeir.co.nz
... With a big November rebound, according to the Real Estate Institute which announced a rise of almost 18 per cent in the number of properties traded last month compared with October.
"The number of properties sold in November across New Zealand increased 17.8 per cent from the previous month – the largest October to November increase seen in six years," REINZ has just announced this morning.
"The number of properties sold in New Zealand excluding Auckland increased 19.4 per cent per cent month-on-month and in Auckland it increased 13.9 per cent month-on-month.
"All regions, except the West Coast, saw sales volume increase in comparison to October," it said.
Sourced from The Herald website
When choosing to make a property investment, the most important thing you can do is to approach the transaction
Licensed Business Owner of Harcourts Twiss-Keir Realty
Licensed Business Owner of Harcourts Twiss-Keir Realty