The clock has struck 12, and new lending restrictions are here, hitting first home buyers really hard, especially this past week. With the over 80% lending restrictions now well intrenched, we have seen a number of banks pull out of the space altogether. This week we have seen Kiwi Bank pull existing pre-approvals for those without a 20% deposit, something I haven’t seen in my career. BNZ have also announced today that they are no longer accepting any applications for clients without a 20% deposit, other than LVR exempt purchases. What this means is that obtaining a pre-approval for the majority of first home buyers is nearly an impossibility right now, and with the new CCCFA regulations, even giving an indication as to someone’s borrowing power is no longer feasible, as it all depends on their individual spending. We also now have a good understanding of how CCCFA looks for every lender, and it really is a game changer across the board. Bank statements are now being put through a computer system to analyse, with every credit and debit being itemised and accounted for in servicing calculations, so it literally is, every dollar that comes out of your account today, will be factored into a loan application tomorrow. It will be interesting working through the next few months of the new year, with Xmas spending playing a factor in clients applications, and we may see this impact peoples abilities to obtain a home loan even harder when holiday spending is factored in to long term finances.
So again, a few changes in the last fortnight with rates continue to increase, with only BNZ rates unchanged from the last fortnight. We also have the OCR review next week, so a few eyes on what happens there. Here’s some comparisons on special rates from my last fortnightly review
• ANZ - 2 year rate was 3.99%, now 4.15%. 5 year unchanged at 5.54% (note ANZ don’t have special 5 year rates)
• BNZ – Both 2 & 5 year rates unchanged, with 2 years at 4.15%, & 5 year at 4.79%
• ASB - 2 year rate was 4.15%, now 4.35%. 5 year was 4.99%, now 5.19%
• Westpac – 2 year special rate was 4.19%, now 4.35%. 5 year was 4.75%, now 4.95%
Full break down of advertised rates from every lender here: https://www.interest.co.nz/borrowing
What’s on the Market in Tauranga
Here’s some good news, we’re still seeing continued growth in available properties for sale on Trademe, with 577 properties currently for sale in Tauranga, a jump of 66 properties in the past fortnight, well over 10%. So there is some reprieve here which is brilliant. 199 of these properties are available on the beach side of Tauranga, and 378 available on the city side.
• 23 of these properties are vacant land
• 73 of these appear in a search range up to $650,000, a number of these are sections, and dwelling builds