Finance

November Update:

Home Loans Today Mortgage News

Current Interest Rates as at 1 November 2011

Variable 5.60%
6 Month Fixed 5.59%
1 Year Fixed 5.59%
2 Year Fixed 5.89%
3 Year Fixed 6.45%
5 Year Fixed 7.25%

Interest Rate Outlook

Well, that’s one gorilla off our back! (& thank goodness!). Not unlike RWC, success is going to take the sum of many parts working together before we will win and of course there are still those variables we cannot control, (think Referees here) such as the state of the European & American economies which unfortunately our banks still have to head toward for funding. We will always be susceptible to their financial stability but that is a “known” by our banks so more & more they are trying to limit the amount they need to fund offshore, (similar to taking the referees decisions out of the game).

Internally, our economic engine continues to be our rural sector and while commodity prices have come back somewhat the market is still strong. The rural surge is timed nicely with the historically low interest rates allowing farmers to reduce debt, freeing up some internal bank capital. Our beautiful country is also set for a tourism boom on the back of what the world has just seen and this should assist the retail sector continue their strong year on the back of RWC.

So there appears to be money flowing in our economy, we just need to ensure this is best utilised, not unlike the farmers, reduction of debt should possibly be many individual’s focus.

Sustained low interest rates are also helping the housing sector as we see the average days to sell houses continue to drop and many examples of multiple offers being placed properties, a momentum we believe will carry through the traditionally buoyant summer months.

As for a current borrowing strategy, variable rates look set to remain at current levels through until mid-2012, accordingly, the floating rate looks the best option right now, although 1 year & 18 month rates are practically the same and provide some nice stability of payment. For those prepared to pay a small margin of 0.25% – 0.50% you can now lock in for 2 years.

If you’re mortgages are coming off fixed interest rates Home Loans Today can help negotiate for you with the main banks. Please do contact Kevin if you would are looking to refix your mortgage.