Getting finance to buy a new property, whether it’s a new home or an investment property, can be tricky in the current financial climate, now that they Reserve Bank is trying to cool the housing market by insisting on higher deposits for mortgages.
The reserve bank actions have very definitely made it more difficult particularly for property investors in New Zealand, as this sector prefers to operate with the minimum possible deposit. The number of house sales repeated markets like the major centres in New Zealand has come back significantly, and a lot less properties are on the market.
What this means for mortgage brokers in Hamilton is that there are fewer buyers chasing properties and it is more difficult for the buyer’s to get decent finance, which ironically means that mortgage brokers are seeing more clients but these clients are in more difficulty.
Good mortgage brokers with good long term investor clients will be enjoying a buoyant market, as their clients will have managed things so that they are still able to purchase properties. The higher deposit rate requirements however we’ll have scared off a number of first home buyers in those with not as much cash for a deposit. These buyers will be trying their luck with mortgage brokers to see if there is a way around the deposit requirement, and good mortgage brokers will know where the deals are that they can get their clients. For example some banks open the door briefly to borrowers with a smaller deposit, but this still working will be a short time only, and the bank will close the door once they have reached some internal limit that they regard as safe.
In today’s environment a typical role for the mortgage broker will be to gently explained to their clients why they are need to curtail your aspirations or downgrade them somewhat. A smart broker may see an opportunity for their client to increase their attractiveness to the bank buy perhaps and fittings a temporary job if they are self employed for example.
Thanks see a strong role for mortgage brokers in working with clients to work out what is possible what is impossible and what is the best plan to make the possible happen. This requires patience and time that event does not necessarily have, but the mortgage broker will be willing to put in the effort because the rewards will generally be lucrative in today’s market. The risk for the bank is that the mortgage brokers in Waikato choose a lending product from another bank, so the bank cannot sit on the Laurels in this area and must make sure that their products are attractive in the current market.