NZ Mortgage Interest Rates on the up again?

[sasvanb]

I've been watching mortgage rates here in NZ carefully since we arrived last year. I was naturally just a little put off by the rates around 8% or so for fixed rates then.... And very happy to see them come down over the months that followed. I suppose considering the slump in the housing market at the same time this would have been the time to buy. But as my OH and I weren't sure we were settled enough to buy anywhere, we held off all that. It now looks like rates are on the up again. Not that this surprises me at all. It just leaves me wondering how affordable buying in NZ is really going to be for us.

http://www.stuff.co.nz/business/pers...k-raises-rates

http://www.interest.co.nz/mortgages.asp?mm10

http://www.stuff.co.nz/national/videos/2820972

Jobs wise it looks like we have a choice to stay in Welly (we had wanted to move to the south island, Dunedin in particular, but that's out for the mo jobs wise)... or Auckland. Now I know house prices may have come down a bit recently, but these too are now on the up again. We didn't come out here with stacks of cash in the bank... so the best we could expect is a do-er upper (read cold, damp, mouldy) place about 45mins to an hour outside of Welly. Oh joy...

Sorry for the rant... (and yes I did know interest rates were higher here before we came) but I didn't expect the choice of housing stock (that we can afford) to be quite so poor. I suppose you need to know that I make all my comparisons housing prices/interest rates with Scotland. So when I look at the kind of place we could still reasonably expect to get back home (outside of Edinburgh that is!) at a much lower rate... well it actually compares very favourably with NZ. Seeing as I am currently struggling with bouts of severe homesickness... it doesn't help that all I see the housing market doing here is: Mortgage interest rates going higher and house prices going up again...

Any comments of encouragement gratefully received...

[Kanga]

I think most people would sympathise with you RE the quality of the housing stock here. My advice to you would be to buy if you can afford it and the time is right for you and to put it out of your mind if you can't or it isn't. We're currently renting a lovely home in a nice area and we couldn't afford a shed (a real Kiwi one- not a NZ house, lol) so we've no plans to buy BUT we do wonder whether we should get in on the bottom rung and buy a rental sometimes. Would that work for you?

[sasvanb]

Thanks Kanga.... You are right of course.... In that we intend to sit tight for the moment and see what happens. I don't know about Waikato, but I tend to find the rental prices quite steep in Wellington (for a decent place in a decent area)... and our landlord was talking about making a 'small' increase early next year. eyes:

I think we will remain where we are until Jan/Feb next year anyway. And then look at what the jobs market is doing elsewhere in NZ. We don't really want to live in a big city (and Welly is big for us compared to the wee scottish town we came from lol... and really Welly was always supposed to be a stop gap for us). So maybe if my OH can land a decent job elsewhere outside of Welly, Auckland or ChCh... then I would hope the house prices may be better in a more 'rural' area...

P.S. OH is an IT Systems Engineer (mainly microsoft based) with over 6 years experience... if anyone knows of anything...

[chocolate cake]

Only my opinion but I wouldn't be in a great race to buy a property right now, prices did begin to move back up but I can't see it being sustained. They are still historically high compared to incomes, and didn't fall as far as other places internationally.

Sure the housing stock, and particularly the rentals are not great, I think it's a matter of trying to find the best you can. Research areas, particularly important if you are buying.
Mortgage interest rates have generally been higher than UK/Europe (& I guess the States) and that will no doubt continue, but there seems little likelihood of them moving greatly higher in the near future.

Better to rent for a while, that get something you can just afford and then look to move a few years on. Moving house, even if there's no transactions taxes (e.g. stamp duty) is not cheap, certainly estate agents are dearer than the UK.

[Mamee & Co]

The Current all time low of the NZ dollar to the GBP will hit us greatly unless we see some recovery by the time we sell our house and transfer our funds out. We had thought that we might manage to be in a reasonable house mortgage free with a bit of a cushion, but that now looks very unlikely. However we have in the past coped with the unique fixer-upperer and will probably do it again! In fact, we are now in the first new build house we have ever bought and it will be the one with a loss! Everything else has had "potential" and I kind of got used to living in a builidng site and without heating at various points. Hope that the last three years haven't softened me up too much!