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On August 11, 2015 in General by olivermortgages

LVR restrictions – proposed changes from 1 October. For all areas outside of Auckland the Reserve Bank will relax restrictions with 15% of all new lending to be allowed above 80% loan to value ratio. Auckland’s restriction will remain at 10% only, which is the current limitation for all of New Zealand. In addition, the purchase of any residential investment property in Auckland will be limited to a maximum 70% lending level. Again, in other areas, lending will be allowable to 80% of purchase price.
Auckland property prices continue to skyrocket. Where and when will it end and how is it going to end?
Dairy farming returns continue to plummet. Payment for the season just ended will be around $4.40 per KG of milk solids compared to $8.50 per KG in 2014. It is expected that the new season will not see any significant change with returns in the $4 - $5 region again.
The OCR is down another 25% and economists are picking that it will reduce further. Floating rates are currently sitting between 6.00-6.50% pa. We expect these rates to be somewhat lower than that before the end of this year. We are now able to source fixed rates below 5.00% pa for shorter terms through most lenders.
Many countries are experiencing tough times.Greece has been in the news and others are struggling to maintain solvency. China and
Australia – our key export markets – are also experiencing slowing economies. Supply and Demand cycles are being interrupted.
These factors influence our economists who strive to maintain the stability that the NZ consumer expects.

Tagged With: OCR, supply and demand, farming, LVR

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