It's no secret that new property listings and total stock numbers are down nationally but even on a basic level both the property sector and financial market have recovered quicker than economists predicted.
You would need a crystal ball to see how the next 12 months is going to treat us, for some Covid was a wrecking ball while for others it has provided new opportunity.
What we are seeing currently is demand keeping house values and prices steady with realestate.co.nz reporting the National average asking price increase by 10.3% in May. Multiple regions saw all time average price increases.
To my ears this is pretty positive when you consider it's winter, election year, and a worldwide crisis.
The only blip at the moment is a shortage of houses on the market. I can tell you without a shadow of doubt there is a stack of buyers waiting and if you were on the fence about selling it’s a great time to let the market determine a great sale price.
It may be a frustrating time for our first home buyers as they fight investors in a multi offer situations but the key is tenacity and preparation.
It is a super competitive space and we continue to see multi offers, lenders getting stricter on criteria, and low deposit lending.
It's looking positive for investors with lenders moving to 75%-80% LVR which also creates some stiff competition at the entry level of the market.
Whichever camp you are in you can never be too prepared. Allow extra time in the current climate for lenders to process your application and potentially a few more requests for extra information.
When lenders get pressure from the sheer volume of applications like they are currently experiencing they are pulling out the fine tooth comb.
They will be scouring your debt profile to look at what they call “your appetite for debt”. Such things as how often you get into debt and how much debt you have. There is no magic number as it can be an internal policy or at their discretion.
They will also have the magnifying glass on your employment and income, pre Covid, during, and post Covid. More than ever they are identifying risk; so, don’t take it personally if we ask for a 'please explain' particularly if you are self employed.
So the top tips to take away from our current lending environment are:
- Have reasonable expectations
- Don’t leave anything until the last minute
- Expect delays
- Call us early
- Plan, Don’t panic
Book a Meeting
Graham Bond
Mortgage Broker
Phone: 027 566 3310
Email: [email protected]
