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

[Beagle]

http://www.nzherald.co.nz/business/n...ectid=11487606

I logged on to internet banking this morning and got a real surprise. Surely not !! 4.69% fixed for 2 years. I racked my early 50's year old brain, barely functioning first thing in the morning after only one coffee and despite all the rusty cogs only just starting to work for the week, I was pretty sure I'd never seen a rate this low in all my life and sure enough, it turns out I haven't.

Does this mean you'll spend more though or maybe gear up to make leveraged market investments ?
Curious what this means to you folks ?

Seems to me rates could go even lower, could it even be possible we'll see 3.99% by the end of this year ?

Surely at that sort of rate there's some mileage in taking a moderatly geared position to invest more in high dividend yield shares or are you a crusty old GFC survivor that's getting old and conservative like me and extremly reluctant to take a geared position in the market ?

Thoughts folks ?

[winner69]

I had a 2nd mortgage at 27.5% once with 1st mortgage over 20% and that was 'mates rates' from a super fund.

A 4% mortgage - unbelievable ......and the young still moan and complain

[BIRMANBOY]

early days.......
Mortgage Rates by Country

All TypesAuto LoanAuto LoansCar LoanEducation LoanEquity LoanFixedGold LoanHome LoanHousing LoanLoanMortgageMortgage LoanPersonal LoanPersonal LoansSecuredStudent LoanVariableHome Loan






Highest Rates by all banksLowest Rates by all banksBest Rates by oldest BanksBest Rates by largest Banks

By Countries/By Banks

Country	Inflation	GDP	Population	Interest Rate	Change	Currency	Last Updated
Switzerland+Follow	0.4%	40,484	8,183,800	1.04%	-	CHF	Jun 2015
United Kingdom+Follow	2%	34,388	64,105,654	1.07%	-	GBP	Jul 2015
Taiwan+Follow	1.6%	31,776	23,410,280	1.88% ~ 3.38%	-	TWD	Jul 2015
Netherlands+Follow	2.3%	39,877	16,876,800	1.90%	-	EUR	Jul 2015
Sweden+Follow	2.5%	35,951	9,728,498	1.97%	-	SEK	Jul 2015
Hong Kong+Follow	5%	45,277*	7,234,800	2.15%	-	HKD	Jul 2015
Canada+Follow	2.8%	37,947	35,540,419	2.19%	-	CAD	Jul 2015
Norway+Follow	1.9%	53,471	5,156,450	2.40%	-	NOK	Jul 2015
Singapore+Follow	4.6%	50,180	5,469,700	2.5%	-	SGD	Jul 2015
Slovenia+Follow		27,900	2,064,647	2.50%	-	EUR	Jul 2015
United States+Follow	1.5%	45,934	319,094,000	2.50%	-	USD	Jul 2015
Slovakia+Follow	3.9%	7,325	5,415,949	2.84%	-	EUR	Jul 2015
Germany+Follow	2.2%	34,388	80,767,000	3.28%	-	EUR	Jul 2015
Ireland+Follow	2.4%	38,685	4,609,600	3.50%	-	EUR	Jul 2015
Chile+Follow	3.3%	15,002	17,819,054	3.60% - 5.10%	▼	CLP	Jul 2015
Poland+Follow	4%	18,837*	38,496,000	4.05%	-	PLN	Jul 2015
Australia+Follow	3.4%	38,663	23,665,600	4.09%	-	AUD	Jul 2015
Austria+Follow	3.3%	39,634	8,527,230	4.3%	-	EUR	Jul 2015
Qatar+Follow	2.8%	78,260	2,187,326	4.35%	-	QAR	Jul 2015
China+Follow	5.4%	6,778	1,367,900,000	4.50%	-	RMB	Jul 2015
Fiji+Follow	8.6%	4,366	859,178	4.50%	-	FJD	Jul 2015
Panama+Follow	5.9%	14,097	3,713,312	4.75%	▼	USD	Jul 2015
New Zealand+Follow	4.5%	26,670	4,541,340	4.95%	▼	NZD	Jul 2015
Greece+Follow	2.9%	29,663	10,992,589	5.25%	-	EUR	Jul 2015
Bulgaria+Follow	4.2%	13,789	7,245,677	5.80%	-	BGN	Jul 2015
Philippines+Follow	5.3%	3,546	100,553,900	6.00%	-	PHP	Jul 2015
Vietnam+Follow	18.9%	2,942	89,708,900	6.49%	-	VND	Jul 2015
Bosnia+Follow		8,127	3,791,622	7.85%	-	BAM	Jul 2015
Bahamas+Follow	1.8%	31,324	368,390	9.00% - 10.5%	-	BSD	Jul 2015
Nepal+Follow	8.3%	1,200	27,646,053	9.00% - 10.50%	-	NPR	Jul 2015
South Africa+Follow	5%	10,229	54,002,000	9.25%	-	ZAR	Jul 2015
Jamaica+Follow	9.4%	9,029	2,717,991	9.50%	-	JMD	Jul 2015
Solomon Islands+Follow		3,345	581,344	9.95%	-	SBD	Jul 2015
Georgia+Follow	-0.5%	6,145	4,490,500	10.25%	-	GEL	Jun 2015
Malaysia+Follow	3.3%	13,800	30,401,400	10.50%	-	MYR	Jul 2015
Indonesia+Follow	5.7%	4,151	252,164,800	11.00%	-	IDR	Jul 2015
Maldives+Follow		9,173	341,848	11.00%	-	MVR	Jul 2015
Sri Lanka+Follow	7.7%	5,220	20,277,597	11.00%-12.50%	-	LKR	Jul 2015
India+Follow	6.8%	3,275	1,262,530,000	11.75%	-	INR	Jul 2015
Thailand+Follow	4.1%	8,051	64,871,000	12.00%	-	THB	Jul 2015
Bangladesh+Follow	10.7%	1,565	157,322,000	13.00%	-	BDT	Jul 2015
Russia+Follow	8.9%	14,913	146,149,200	14.25%	-	RUB	May 2015
Turkey+Follow	7.8%	13,905	76,667,864	15.48%	▲	TRY	Jul 2015
Zimbabwe+Follow	8.3%	559	13,061,239	18.50%	-	USD	Jul 2015
Ukraine+Follow	9%	6,665*	42,977,367	22.30%	-	UAH	Jul 2015

[Xerof]

I had a 1st at 23.5%, in the late 80's/early 90's but the house only cost 425k. Servicing was actually quite comfy at around 30% or so of income, but int only IIRC

the youngish might get it at 4.69, but they need to pass a stress test of a notional 7+ don't they? If they don't, they should! When rates go back up, the fireworks begin......

And the equivalent price today of my property then would be well over a mill. salaries ain't that much higher either, really

Roger, re leverage - crusty old survivor of 87 and 08. Have only leveraged FX with limited success, but wouldn't bother on equities

so, means nothing to me except lousy savings rates for surplus cash

[kiora]

early days.......
Mortgage Rates by Country

All TypesAuto LoanAuto LoansCar LoanEducation LoanEquity LoanFixedGold LoanHome LoanHousing LoanLoanMortgageMortgage LoanPersonal LoanPersonal LoansSecuredStudent LoanVariableHome Loan






Highest Rates by all banksLowest Rates by all banksBest Rates by oldest BanksBest Rates by largest Banks

By Countries/By Banks

Country	Inflation	GDP	Population	Interest Rate	Change	Currency	Last Updated
Switzerland+Follow	0.4%	40,484	8,183,800	1.04%	-	CHF	Jun 2015
United Kingdom+Follow	2%	34,388	64,105,654	1.07%	-	GBP	Jul 2015
Taiwan+Follow	1.6%	31,776	23,410,280	1.88% ~ 3.38%	-	TWD	Jul 2015
Netherlands+Follow	2.3%	39,877	16,876,800	1.90%	-	EUR	Jul 2015
Sweden+Follow	2.5%	35,951	9,728,498	1.97%	-	SEK	Jul 2015
Hong Kong+Follow	5%	45,277*	7,234,800	2.15%	-	HKD	Jul 2015
Canada+Follow	2.8%	37,947	35,540,419	2.19%	-	CAD	Jul 2015
Norway+Follow	1.9%	53,471	5,156,450	2.40%	-	NOK	Jul 2015
Singapore+Follow	4.6%	50,180	5,469,700	2.5%	-	SGD	Jul 2015
Slovenia+Follow		27,900	2,064,647	2.50%	-	EUR	Jul 2015
United States+Follow	1.5%	45,934	319,094,000	2.50%	-	USD	Jul 2015
Slovakia+Follow	3.9%	7,325	5,415,949	2.84%	-	EUR	Jul 2015
Germany+Follow	2.2%	34,388	80,767,000	3.28%	-	EUR	Jul 2015
Ireland+Follow	2.4%	38,685	4,609,600	3.50%	-	EUR	Jul 2015
Chile+Follow	3.3%	15,002	17,819,054	3.60% - 5.10%	▼	CLP	Jul 2015
Poland+Follow	4%	18,837*	38,496,000	4.05%	-	PLN	Jul 2015
Australia+Follow	3.4%	38,663	23,665,600	4.09%	-	AUD	Jul 2015
Austria+Follow	3.3%	39,634	8,527,230	4.3%	-	EUR	Jul 2015
Qatar+Follow	2.8%	78,260	2,187,326	4.35%	-	QAR	Jul 2015
China+Follow	5.4%	6,778	1,367,900,000	4.50%	-	RMB	Jul 2015
Fiji+Follow	8.6%	4,366	859,178	4.50%	-	FJD	Jul 2015
Panama+Follow	5.9%	14,097	3,713,312	4.75%	▼	USD	Jul 2015
New Zealand+Follow	4.5%	26,670	4,541,340	4.95%	▼	NZD	Jul 2015
Greece+Follow	2.9%	29,663	10,992,589	5.25%	-	EUR	Jul 2015
Bulgaria+Follow	4.2%	13,789	7,245,677	5.80%	-	BGN	Jul 2015
Philippines+Follow	5.3%	3,546	100,553,900	6.00%	-	PHP	Jul 2015
Vietnam+Follow	18.9%	2,942	89,708,900	6.49%	-	VND	Jul 2015
Bosnia+Follow		8,127	3,791,622	7.85%	-	BAM	Jul 2015
Bahamas+Follow	1.8%	31,324	368,390	9.00% - 10.5%	-	BSD	Jul 2015
Nepal+Follow	8.3%	1,200	27,646,053	9.00% - 10.50%	-	NPR	Jul 2015
South Africa+Follow	5%	10,229	54,002,000	9.25%	-	ZAR	Jul 2015
Jamaica+Follow	9.4%	9,029	2,717,991	9.50%	-	JMD	Jul 2015
Solomon Islands+Follow		3,345	581,344	9.95%	-	SBD	Jul 2015
Georgia+Follow	-0.5%	6,145	4,490,500	10.25%	-	GEL	Jun 2015
Malaysia+Follow	3.3%	13,800	30,401,400	10.50%	-	MYR	Jul 2015
Indonesia+Follow	5.7%	4,151	252,164,800	11.00%	-	IDR	Jul 2015
Maldives+Follow		9,173	341,848	11.00%	-	MVR	Jul 2015
Sri Lanka+Follow	7.7%	5,220	20,277,597	11.00%-12.50%	-	LKR	Jul 2015
India+Follow	6.8%	3,275	1,262,530,000	11.75%	-	INR	Jul 2015
Thailand+Follow	4.1%	8,051	64,871,000	12.00%	-	THB	Jul 2015
Bangladesh+Follow	10.7%	1,565	157,322,000	13.00%	-	BDT	Jul 2015
Russia+Follow	8.9%	14,913	146,149,200	14.25%	-	RUB	May 2015
Turkey+Follow	7.8%	13,905	76,667,864	15.48%	▲	TRY	Jul 2015
Zimbabwe+Follow	8.3%	559	13,061,239	18.50%	-	USD	Jul 2015
Ukraine+Follow	9%	6,665*	42,977,367	22.30%	-	UAH	Jul 2015

From tradingeconomics
New Zealand Inflation Rate 1918-2015 | Data | Chart | Calendar | Forecast
The inflation rate in New Zealand was recorded at 0.30 percent in the second quarter of 2015. Inflation Rate in New Zealand averaged 4.80 percent from 1918 until 2015, reaching an all time high of 44 percent in the third quarter of 1918 and a record low of -15.30 percent in the first quarter of 1923. Inflation Rate in New Zealand is reported by the Statistics New Zealand.
But now 2% for tradeable goods
So shouldn't interest rates should be more like 2.5 % ?
Maybe time to borrow more and let the dividends pay the interest bill

[Beagle]

I had a 1st at 23.5%, in the late 80's/early 90's but the house only cost 425k. Servicing was actually quite comfy at around 30% or so of income, but int only IIRC

the youngish might get it at 4.69, but they need to pass a stress test of a notional 7+ don't they? If they don't, they should! When rates go back up, the fireworks begin......

And the equivalent price today of my property then would be well over a mill. salaries ain't that much higher either, really

Roger, re leverage - crusty old survivor of 87 and 08. Have only leveraged FX with limited success, but wouldn't bother on equities

so, means nothing to me except lousy savings rates for surplus cash

Yeah me too mate but 3.99% fixed for 5 years might have me re-thinking my investment strategy a bit.

[Harvey Specter]

What does it mean for me? It means I am a bit annoyed I locked in a portion of my loan about 6 months ago. And annoyed that they still charge such a high margin on float rates. Both in the high 5s while people are sub 5% annoys me.

[macduffy]

What does it mean for me? It means I am a bit annoyed I locked in a portion of my loan about 6 months ago. And annoyed that they still charge such a high margin on float rates. Both in the high 5s while people are sub 5% annoys me.

And I'm a bit annoyed because it means less interest income for me from the cash part of my portfolio and a greater incentive to top up on dividend-paying equities!

[iceman]

Yeah me too mate but 3.99% fixed for 5 years might have me re-thinking my investment strategy a bit.

I think you have answered your original question !! I would think many will be thinking along similar lines as we have many stocks on the NZX that pay steady ad fairly safe dividends well above that rate

[LAC]

Its also nerve wrecking if your mortgage fixed term is ending soon and you know the rates are going to drop further but the floating is way too high to leave it on there and the fixed is good for a 1 year+. Anyone neg. with their bank for a sub 5 for 6mths? If so, which bank?