Unlocking the Potential of Real Estate Investment
The landscape of the real estate market is dynamic, constantly shifting and evolving. As an experienced mortgage broker in Tauranga, I’ve had the privilege of witnessing these shifts firsthand. Recent trends have seen a rapid shift towards a seller’s market, pushing property prices upwards. While this may seem daunting to potential buyers, there are several compelling reasons why now is the perfect time to invest in real estate.
1. Rising House Prices
The resilience of the real estate market is evident in the recovery of house prices. After a period of decline, house prices have bottomed out and are now showing signs of a steady increase. This trend is particularly noticeable in regions like Tauranga. This recovery is not just an indication of a robust market; it’s a sign of potential capital growth for investors.
Investing in a market where prices are on an upward trajectory can lead to significant returns in the future. As property values increase, so does the equity in your home. This equity can be leveraged to expand your investment portfolio, opening up the possibility of wealth creation.
2. Stable Interest Rates
The Official Cash Rate (OCR) has peaked, indicating that interest rates have also reached their zenith. This stabilization provides a level of certainty for mortgage repayments, making it a favourable time for potential homeowners to secure a loan.
Interest rates play a crucial role in the cost of borrowing. Lower interest rates mean lower mortgage repayments, making homeownership more affordable. With the OCR at its peak, we can anticipate a period of stability in interest rates. This stability allows for better financial planning, as borrowers can have certainty in their repayment amounts.
3. Increased Loan to Value Ratios
Banks have recently increased their Loan to Value Ratios (LVRs), allowing for more funds to be available for lending. This increase in LVRs means that potential homeowners can borrow more against the value of their property, making it easier to secure a mortgage.
An increase in LVRs is a positive development for both first-time homebuyers and investors. A higher LVR means a smaller deposit is required, making it easier to get onto the property ladder. For investors, it means the ability to leverage more equity in their existing properties to expand their portfolio.
4. Changes in the Credit Contracts and Consumer Finance Act (CCCFA)
Banks are now more willing to lend due to changes in the CCCFA. They are paying less attention to borrowers’ spending habits, meaning your lifestyle choices, like enjoying avocado on toast, won’t impact your ability to secure a loan.
The changes in the CCCFA have made the lending environment more favourable for borrowers. Banks are now focusing more on a borrower’s ability to repay the loan rather than their spending habits. This shift in focus means that more people can qualify for loans, opening up the property market to a wider range of investors.
5. Seasonal Market Trends
Spring, traditionally the busiest time in the real estate market, is just around the corner. Most buyers aim to settle into their new homes before Christmas, making this a bustling period for property transactions.
The seasonal surge in property transactions presents an opportunity for buyers and sellers alike. For sellers, it means a larger pool of potential buyers and the possibility of higher sale prices. For buyers, it means a wider range of properties to choose from.
About Best Mortgages
Tauranga’s Best Mortgages has been a trusted mortgage broker for 15 years and have helped hundreds of families reach their property goals. Our name says it all—we find the greatest mortgage solutions for our clients. We offer refinance, first home buyer, refinance, and investment property loans. We proudly serve clients across New Zealand.
Best Mortgages understands that buying a home is a major financial decision that demands careful consideration. We listen to our clients and comprehend their financial situations. We can then provide them the best financial solutions to help them become homeowners. Our skilled mortgage brokers shop around for the best lending product for our clients. We strive to make lending easy.
To ensure a stress-free experience, we guide our clients throughout. Best Mortgages can assist first-time homebuyers and seasoned investors accomplish their property ambitions. Discuss your home lending needs with us today to find the best mortgage for your situation. As a Best Mortgage broker, we assist you locate the right mortgage for your needs.
Don’t just take our word for it, check out what our clients have to say about us on our reviews page. Ready to get started? Give the Best Mortgage brokers a call today on 021 449 177 or reach out to us through our contact page