Property investors are usually in the firing line for all the wrong reasons however the low property value growth is due to their higher than usual market share of low end property sales.
Statistics from sales in September 2014 confirmed property investors had a 45 percent market share of all low end property sales. By contrast first home buyers market share has been dropping and its due to the RBNZ LVR restriction on banks lending over 80 percent of the the property value. They secured just 19 percent of property sales. The higher than usual investor market share has resulted in properties selling for less and overall the growth in property value kept low.
Low property value growth is an opportunity for first home buyers however they need to prepare well if they wish to secure a low deposit loan. Many of the banks are ‘educating’ first home buyers’ on the requirements for low deposit loans including Westpac.
Westpac have published an article in their REDnews section of their website on how to prepare for a low deposit loan and while these tips are readily known by property investors first home buyers could really benefit from them.
The tips include how to get your bank accounts in good working order. Not all debt is bad debt and banks will assess your suitability on the type of debt you have. In their article Westpac say – a student loan is fine, whereas an expensive car loan or maxed out credit cards is not okay.
Another good tip is to contact a mortgage broker. Mortgage Brokers like Kris Pedersen know when to time your mortgage application so it’s nicely placed within the Bank’s quota for low deposit loans. If the bank in question has nearly maxed out their lending of new low deposit loans – it’s not a great time to put in an application.
Written by Mobilize Mail for PropertyBlogs.