News - 15 October 2007

The Alpha Update

A Beginner’s Guide to Buying Your First Residential Investment Property

If you are about to embark on buying your first residential investment property, it is important to know what steps must be taken (and in what order) to make the experience stress-free and enjoyable.

If you have a combined income of around $70,000 pa and have good equity in your own home (at least $200,000), or have at least $50,000 as a cash deposit and a good income, you may be able to purchase a brand new brick & tile home for around $400,000. The rent and depreciation you will receive on a purpose built investment property will assist with your mortgage payments on the property

These days many young couples make this their first option when buying a house - the investment property comes first.

To find out more about the process and how you can get into your first home , give Stuart a call on 021 676 747 or 0800 676 747. We Can Help!

Food for Thought

Some cause happiness wherever they go; others, whenever they  go. -- Oscar  Wilde

What's New??

• Win a House! - Spring campaign from ASB Bank
• Buy or sell a house or refinance a mortgage - without seeing a lawyer!

For more information about any of these opportunities, email Stuart@alphagroup.co.nz

Interest Rate and Currency Comments

Interest rate "rebalancing" has occurred in the past few weeks, with longer term rates going up between 0.1% and 0.15%, and shorter rates coming down a touch. This has been driven by the higher cost of funds offshore, as US interest rates climb again. The number of house sales has declined, however prices remain firm or have climbed slightly (in the main). Until unemployment rates rise significantly, people will have money for mortgage payments or rent, which will underpin house prices.

Our dollar has shot into the mid/late 70 cent range against the US dollar as signs of continuing strength in the economy, possible tax cuts on the horizon, and continued weakness in the US economy all come into play. The exchange rate could again get to 80 cents and will remain high, albeit volatile, for some months to come.

(See below for latest interest and exchange rates).

The Finance Markets

As of 8am on Monday 15 October 2007 the following Interest Rates applied:
Official cash rate 8.25% (stable)
90 day bill rate 8.68% (down)
5 year bond rate 6.72% (up)
NZ/US Dollar 0.7691 (up from 0.7084)

Current Range of Interest Rates for home and investment mortgages as at 15 October 2007.

Floating:
9.7 to 10.80% (stable)

Fixed For:
1 Year - 9.22% to 10.22% (stable)
2 Year - 8.99% to 9.85% (stable)
3 Year - 8.70% to 10.05% (up slightly)
4 Year - 8.75% to 9.85% (down slightly)
5 Year - 8.70% to 9.68% (stable)

For a complete table of interest and exchange rates, click here.

The information stated herein was correct at the time of release, but is subject to changes without notice.