Is it a Great time to Buy my First Home?
With my role as a Financial Adviser specialising in Mortgage Brokering I get to read many articles from different sources, banks, economists, and the government as I am sure you all do as well.
I have been a Mortgage Broker for years and I have learned over time there are 4 key components people need to buy houses so… here they are…
1. Access to credit, that simply means will I get a loan to buy my home, the answer is yes, banks are willing to lend especially now with the Loan to Value Ratios (LVR) recently eased by the Reserve Bank, all you need is just a 5% deposit as a First Time Buyer or use equity in your own home to buy and investment property, this is a game changer.
2. Cost to borrow, Interest rates have plummeted lately as you all know, its never ever been cheaper to borrow, in most cases it cheaper to pay your own mortgage repayments per week then rent, to show this I have a scenario below.
3. The market, lots of commentary around doom and gloom here which I have been watching and to be honest houses prices are very stable in Christchurch, sure if you had recently purchased in Queenstown, Rotorua or even Auckland you may be a bit nervous of your house price but housing is a long term investment, most first time buyers aren’t flickers so even if your home doesn’t increase in value over the next 12 months so what who cares at least it’s your own home and you are paying off your mortgage rather than someone else’s and in charge of your own destiny.
4. Confidence, there is nothing new in confidence in your own ability to pay you mortgage, having said that wouldn’t it be better to pay your own mortgage than your current rent which is a greater cost than your mortgage. If you have solid employment and confidence in your future, then it has never been a better time to buy.
Scenario Owning vs Renting
Purchase Price $375000
Deposit (5%) $18750
Mortgage $356250
Mortgage Interest rate 2.80% cost per week $338
Rent per week average in Christchurch $400
Savings of $62 per week.
Be like Aimee and Nate and move in, its a simple process if you are unsure just ask me…