Mortgage Rate hits 60 year low - What does that mean to you ?

[winner69]

try scraping at 20% deposit together when you're young. Back when rates were that high banks were handing out money left, right and centre to anyone willing to take it. It takes a hell of a long time to get 20%, say lets call of $50k when you're fresh out of uni and working for $25 per hour. Not all the young have parents in a position to offer equity either

Banks weren't that generous in my days either. Thus most of use had 2 or 3 mortgages.

We scrapped the bottom of the barrel to get a deposit as well and sacrificed a lot for a few years, like no car.

Anyway most of us have bad times eh.

The moan comment was about those who complain that a 5% rate is outrageous. Just putting things in (historical) context.

Best of luck with your putting together a deposit.

[Beagle]

try scraping at 20% deposit together when you're young. Back when rates were that high banks were handing out money left, right and centre to anyone willing to take it. It takes a hell of a long time to get 20%, say lets call of $50k when you're fresh out of uni and working for $25 per hour. Not all the young have parents in a position to offer equity either

Fact is its never been easy to own a house in Auckland. I needed 20% back in 1991, actually $30,000 on my first house which cost $128,000.
I saved $10,000 a year for 3 years. The FIRST $200 I earned each week went into a home loan savings account. I lived a very, very frugal lifestyle of the rest of what I earned. Stripped just about every single item of discretionary spending out of my budget, (booze, entertainment, travel, were simply not options, a very cheap crappy car which I drove the minimum possible distance, and lived like a frugal monk for 3 whole years. Worked part time from home doing accounting jobs too as well as my full time salaried position.

A few weeks ago I saw a three bedroom basic starter home in Papakura for $399,000. 1960's weatherboard with 1960's décor. Perfect starter home I thought for someone. Trouble with young people today is they don't want to start at the bottom of the ladder, I know because we tried to help one of our daughters get into a basic 2 bedroom flat in West Auckland and she and her boyfriend turned their noses up at it, apparent a basic 1960's or 1970's 2 bedroom flat in a very modest suburb with dated décor isn't good enough these days !! Whatever happened to getting in at the bottom and rolling your sleeves up and using some hard work to do it up and make a profit ?

[macduffy]

This is starting to sound like something from the Monty Python show or somesuch - "Do you think that's hard! We lived in a paper bag!"

But seriously, it was just as hard to find four thousand pounds ($8,000) in the mid 1960's for a deposit on a $28,000 house - if you could qualify for a loan. The difference was that full employment was the norm and moonlighting part-time work was much easier to find.

[stoploss]

Fact is its never been easy to own a house in Auckland. I needed 20% back in 1991, actually $30,000 on my first house which cost $128,000.
I saved $10,000 a year for 3 years. The FIRST $200 I earned each week went into a home loan savings account. I lived a very, very frugal lifestyle of the rest of what I earned. Stripped just about every single item of discretionary spending out of my budget, (booze, entertainment, travel, were simply not options, a very cheap crappy car which I drove the minimum possible distance, and lived like a frugal monk for 3 whole years. Worked part time from home doing accounting jobs too as well as my full time salaried position.

A few weeks ago I saw a three bedroom basic starter home in Papakura for $399,000. 1960's weatherboard with 1960's décor. Perfect starter home I thought for someone. Trouble with young people today is they don't want to start at the bottom of the ladder, I know because we tried to help one of our daughters get into a basic 2 bedroom flat in West Auckland and she and her boyfriend turned their noses up at it, apparent a basic 1960's or 1970's 2 bedroom flat in a very modest suburb with dated décor isn't good enough these days !! Whatever happened to getting in at the bottom and rolling your sleeves up and using some hard work to do it up and make a profit ?

Was nothing wrong with the flat Rog , she just didn't want to be a Westie !!!

[axe]

[QUOTE=Roger;584106] Stripped just about every single item of discretionary spending out of my budget, (booze, entertainment, travel, were simply not options, a very cheap crappy car which I drove the minimum possible distance, and lived like a frugal monk for 3 whole years. Worked part time from home doing accounting jobs too as well as my full time salaried position.

The younger generations (which I am part of) suffer from an entitlement syndrome.
We expect to be able to afford all of the luxury discretionary purchases and afford a house too.
Why should we have to make personal sacrifices to our lifestyles and cut back on our luxuries to be able to afford a house? The house should just be cheaper. The government should step in and make it cheaper for me.

[Beagle]

[QUOTE=axe;584129]

Stripped just about every single item of discretionary spending out of my budget, (booze, entertainment, travel, were simply not options, a very cheap crappy car which I drove the minimum possible distance, and lived like a frugal monk for 3 whole years. Worked part time from home doing accounting jobs too as well as my full time salaried position.

The younger generations (which I am part of) suffer from an entitlement syndrome.
We expect to be able to afford all of the luxury discretionary purchases and afford a house too.
Why should we have to make personal sacrifices to our lifestyles and cut back on our luxuries to be able to afford a house? The house should just be cheaper. The government should step in and make it cheaper for me.

It is refreshing to hear that coming from a GenY. To be fair though I do think it perhaps APPEARS to be a bit harder now relative to income. Back in 1991 the average house in Auckland was 5 times the average household income, (according to the department of statistics), now its more like 8 times. That said, my first home was bought with a mortgage at 15.5% whereas as I've noted above its now possible to borrow for 3 years fixed for as little as 4.49% !!!!!
I think taking into account the prevailing extremely low interest rates its probably no really any harder to get in at the bottom than it was.

LOL Stoploss - nothing could be further from the truth..she's a real Tom Boy that one

[kiora]

Whats everyone picking for morgage interest rates in the next 1-2 years ?
https://www.interest.co.nz/business/...erbury-rebuild
I'm picking 4.5 % due to increasing unemployment.
Maybe lower ?

[Beagle]

3.99% and the bank will tell you Kiora when you uplift your mortgage because nobody will be borrowing as the economy is in recession...you read it here first Don't listen to the Government propaganda that we're all right Jack....they're just trying to talk us out of the inevitable. Mortgagee sales on dairy farms coming left right and centre...front page news of the Herald today and this is just the very beginning of it.

[Beagle]

Well we're edging closer to the magic 3.99%, a rate of 4.35% in the market now and the Reserve bank will drop the cash rate tomorrow as sure as the sun rises so we are on our way...only a matter of time before one of the banks steals a marketing coup on the others and goes down there.

[Beagle]

And there we have it. Two banks now offering 3.99% mortgage finance as predicted. Shame its just for residential owner occupied homes as some of the dairy farmers could really do with the help from ultra low rates like that.

So is it finally time to gear up and borrow at 3.99% for "home renovations" (that's what you tell your bank to get the ultra low rate), but it happens to find its way into the share market in high yielding stocks paying 8% gross divvies or more ?