Cairns Lockie Mortgage Commentary
Issue 2003/10
Welcome to the tenth Cairns Lockie Mortgage Commentary for 2003. This is a fortnightly electronic newsletter, which aims
to keep you informed on developments at Cairns Lockie, Mortgage Bankers and the mortgage market in general. Previous
issues of this commentary can be found on our website
The Money Market
This morning (8am on 13 June 2003) the money markets were at the following levels:
Official cash rate 5.25% (down from 5.50%)
90 day bill rate 5.25 (down from 5.27)
1 year swap rate 4.95 (down from 5.04)
3 year swap rate 5.13 (down from 5.32)
10 year bond rate 5.06 (down from 5.38)
Kiwi dollar 0.5790 (up from 0.5775)
Further Advances Made Easy
A number of borrowers are seeking further advances to improved their homes or purchase other assets. We have improved
our top up procedure to make this easier and faster. If the amount required is under $100,000, the borrower has been in
their current job for a year and there is good repayment history, we can dispense with the normal application form. We
have a much shorter one, which we pre-complete, removing the need for an updated statement of position or payslips etc.
We have also removed the need for new valuations, if the last one is less than 2 years old. If you or your clients would
like a further advance, give us a call.
NZ Wealth is Improving
In the past year, the net worth of New Zealanders, (the difference between assets and debt) improved by $13.3 billion to
$224.3 billion, according to Westpac's latest savings indicators. This is good news for the country. The increase was
largely due to an increase in housing values, which in most parts of the country have been appreciating over the past 12
- 18 months. Bank call and term deposits increased as well. The increase in our net worth would have been higher had it
not been for the considerable outflows and the decrease in asset values in the managed funds area. These are the main
savings and superannuation vehicles for a number of people.
New Zealand Rates Compared With Australia
A large number of Kiwis have properties in Australia particularly in locations such as Queensland. The biggest
difference between Australia and here is that most mortgages there are written at the floating-rate, which is little
different from the fixed rates. The average bank floating-rate is around 6.57% whereas a number of non-bank players are
offering floating-rates from 6.03% to 6.25%. There are a number of specials on at the moment at under 6.00%. Three-year
fixed rates range from 6.09% to 6.45%
Self-Employed and Having Trouble Getting a Home Loan?
Many self-employed people have trouble getting a home loan. Generally it is because they have difficulty showing that
there is surplus income. When a small business is growing, most available cashflow, is being used to fund business
expansion. Our solution is the "No Financials" home loan. All the borrower has to do, is self-certify their income and
we can proceed with the loan. This home loan has all the bells and whistles that you would expect. This includes redraw
facilities, lines of credit, fixed and floating rate options, interest only terms (up to 10 years) and we can structure
it to be tax effective. Please call us for more details
Our current mortgage interest rates are as follows
Variable rate 7.00% (new)
No Financials Home Loan 8.00 (new)
Jumbo Loan 7.00 (new)
Quick Start Home Loan 5.90 (new)
One-year fixed rate 6.21 (new) Two-year fixed rate 6.32 (new) Three-year fixed rate
6.44 (new) Five-year fixed rate 6.51 (new)
Line of credit facility 7.10 (new)