According to mortgage expert Rupert Goff, the housing market is set to improve with more opportunities for buyers.
There’s no question that people still want to buy property, even though interest rates are rising, Goff told breakfast this morning.
“People are coming back. There’s a baseline. New Zealanders want to buy property, so there’s always someone interested.
“The trick that has caused all these problems over the past year is actually getting the banks to say yes and jumping over hoops put up by the government so they can say yes.”
He has two basic things that make people nervous. interest rates and asset values.
“Rate rates are starting to level out and have been in the mid-5 to mid-6 range for the past few months, a significant change from 2.5% a year ago,” he said.
“Property prices are still an issue. You may have a hunch that they will or will not fall any further. Summer is approaching, people are considering buying, and financing is becoming easier. Interest rates are stable.”
Gough believes the market will continue to improve beyond the summer as restrictions that make it harder for people to borrow money are beginning to be lifted.
Banks can now lend to people who are “deserving to lend,” he added.
“So there are more buyers coming back to the market, which means better buying opportunities.”
For first-time mortgage buyers, faster is always better, because the sooner you pay off your mortgage, the less interest you’ll pay, Gough said.
“I mean, 30 years is the longest. See what you can do then, see where you can put extra money into that mortgage, and save a lot of money.
“Basically double. $1,000 saves you $2,000 in the long run. It’s worth it in the first few years of your mortgage.”