The world of home lending is upside down


The mortgage world is in topsy-turvy territory. It used to be that fixed rate deals cost more than the floating rate (borrowers would pay more for the certainty of knowing what their payments would be).

Today, however, there are dozens of fixed rate deals that sit well below the average  floating rate of  5.6 per cent.

For example, if you look at the ASB (floating 5.5 per cent), you could get a rate of between 4.25 per cent (one year) and 4.79 per cent (five years).

And these rates may go down  during the course of the year. In fact, rolling over a few one and two-year deals may work out cheaper than a five-year lock-in. Do the maths and toss a coin.

Keep it fresh

Housing Minister Nick Smith is also the Environment Minister. It’s a conflicted portfolio because home construction risks negatively impacting on the environment.

For example, when earth is excavated for a housing development and is dumped in someone’s backyard — sometimes the earth is contaminated and risks polluting land and waterways.

So it’s no real surprise that Smith reckons that having all our bodies of fresh water clean enough to swim in is not achievable (I’d counter they started out clean enough … ).

On Tuesday he told an audience at Lincoln University that he faced challenges with (improving) water quality and cautioned “those who exaggerate the problem at the expense of New Zealand’s reputation”.

In an effort to reassure the audience he said: “Our water quality is generally good by international standards.” In my opinion, “generally good”, is not good enough.

Albany growing

Albany  is coming along in leaps and bounds with new apartment blocks starting to take shape.  It won’t be long before thousands of new residents will flood the Albany bus station.

We need the housing — no question. But I do hope Auckland Transport is planning for the obvious increase in patronage.

Property Report

On Monday our quarterly property report will be included free with your Herald.

This 24-page special publication features data exclusively from revealing average property prices in suburbs across the North Island.

In addition we have features on the Auckland Unitary Plan, we investigate why it is so expensive to build a home in New Zealand when compared to other countries, and we examine why the pain will continue for Auckland’s first-time home buyers.

There are also home-buying destination reports looking at Warkworth, St Heliers and Westmere.