From NZ Herald
"ANZ New Zealand has upped the ante for residential property investors increasing the minimum deposit to 40 per cent."
"ANZ managing director personal, said it would also be recommending to the Reserve Bank that the loan to value ratios for property investors be set to 60 per cent rather than the proposed 70 per cent."

Why don't they ask me? I'd say
FHB 5% deposit
Rental property investors 50% deposit
Retiress and homeless 0% deposit

aklreels - 2020-12-15 12:21:00

Why would banks lend on 5% or 0% deposit? To households evidently unable to manage their finances. Maybe taxpayers should guarantee the loans? That might make banks a little more interested, but only a little due to the quite considerable extra work involved in managing bad payers, guarantee or not.

Plenty of households have credit or tenancy or income issues. All of which impact on risk and serviceability.

artemis - 2020-12-15 12:39:00

artemis wrote:

Why would banks lend on 5% or 0% deposit? To households evidently unable to manage their finances. Maybe taxpayers should guarantee the loans? That might make banks a little more interested, but only a little due to the quite considerable extra work involved in managing bad payers, guarantee or not.

Plenty of households have credit or tenancy or income issues. All of which impact on risk and serviceability.

taxpayers are already guaranteeing loans to the landlords via the accommodation supplement......if the govt is going to supplement housing at the very least they should help the actual person living in the house, not some other person who seemingly has enough money to buy more than one house.

Edited by lakeview3 at 1:09 pm, Tue 15 Dec

lakeview3 - 2020-12-15 13:04:00

i know plenty of people who could service a mortgage based on the rent they pay (including the additional costs, like rates and insurance). The issue is, their rent is too high, and it makes it hard to pay this, and save for the deposit at the same time

0% deposit home loans, for people who pass the right checks, would help alot of people enter the property market. I can understand the bank not wanting to take on that risk by themselves though. Perhaps this is where the government could step in and act as guarantor?

phoenix22 - 2020-12-15 13:16:00

phoenix22 wrote:

i know plenty of people who could service a mortgage based on the rent they pay (including the additional costs, like rates and insurance). The issue is, their rent is too high, and it makes it hard to pay this, and save for the deposit at the same time

0% deposit home loans, for people who pass the right checks, would help alot of people enter the property market. I can understand the bank not wanting to take on that risk by themselves though. Perhaps this is where the government could step in and act as guarantor?

exactly, it’s been done before and there is no reason why they can’t do it again.

Of course all the people who benefited from it the first time around don’t want others to have the same opportunity. I actually think the govt needs to be bold, and I guarantee most kiwis would support the idea and the ones that don’t aren’t the ones who vote for them anyway. I would love to see our govt really help the young ones. They are our future.

lakeview3 - 2020-12-15 13:24:00

Surprised others have not recognised why this is happening. Nothing to do with helping first home buyers it is about protecting their (the banks) interests when interest rates start going up and values fall. This WILL happen in 2-5 years and the banks are most exposed on investment properties as they are likely to default first.

tony9 - 2020-12-15 17:35:00

aklreels wrote:

..........
Retiress and homeless 0% deposit

Riiight, so how do the banks cover the defaults which will come roaring in?

tony9 - 2020-12-15 17:38:00

Bad news for tenants.
Just keep punishing them.

pcle - 2020-12-15 17:46:00

tony9 wrote:

Riiight, so how do the banks cover the defaults which will come roaring in?

yeah probably all the same people who lost money on the ‘87 crash, the SCF and now they will come crying for everyone to save them again......their greed and get rich quick schemes and everyone else has to keep bailing them out. Some people should be left to fail. Like the SCF people should have been. Read the book billion dollar bonfire......gives an insight into this kind of thing. Let’s face it, the nz property market is just a Ponzi scheme.

lakeview3 - 2020-12-15 17:58:00

phoenix22 wrote:

i know plenty of people who could service a mortgage based on the rent they pay (including the additional costs, like rates and insurance). The issue is, their rent is too high, and it makes it hard to pay this, and save for the deposit at the same time

0% deposit home loans, for people who pass the right checks, would help alot of people enter the property market. I can understand the bank not wanting to take on that risk by themselves though. Perhaps this is where the government could step in and act as guarantor?

And when the interest rates balloon and they default?

smallwoods - 2020-12-15 18:03:00

phoenix22 wrote:

i know plenty of people who could service a mortgage based on the rent they pay (including the additional costs, like rates and insurance). The issue is, their rent is too high, and it makes it hard to pay this, and save for the deposit at the same time

0% deposit home loans, for people who pass the right checks, would help alot of people enter the property market. I can understand the bank not wanting to take on that risk by themselves though. Perhaps this is where the government could step in and act as guarantor?

Hell no. Why should taxpayers carry that sort of risk?
Home ownership takes planning and dedication. I'd expect the failure rate to be a lot higher for people just given it.

heather902 - 2020-12-15 18:27:00

Let's say that a bank is willing to lend, without a deposit.

If the Government or a related body act as a guarantor, the amount of the guarantee should not me more than the standard deposit.
Alternative- the Government or related bodies should never act as guarantor.
The banker has to screen/vet/assess each loan application with care.
And to be realistic, most applications will be declined and only a small portion of their loan portfolio will be on 0% deposit.

No taxpayer money to be allocated as "deposits" and certainly no bail out of the banks should they fail.

An ideal scenario........?

aklreels - 2020-12-15 18:51:00

ANZ is not the only bank lending money for property .. unless all the others follow then the effect is minimal ..

pf - 2020-12-15 19:12:00

There is a very big reason why banks do not offer 100% mortgages, particularly to first home buyers (or people with no equity already) - does nobody else remember when they were doing this back in the early 2000's? What happened? Interest rates went up and property values took a dip - next minute people suddenly owed more to the bank than what their properties were worth and the banks called in their loans - I recall the pages of mortgagee sales in the papers at the time.

rhys12 - 2020-12-15 21:46:00

pf wrote:

ANZ is not the only bank lending money for property .. unless all the others follow then the effect is minimal ..

Correct, there are plenty of bank and increasingly competitive non bank options.

jeffqv - 2020-12-15 22:26:00

rhys12 wrote:

There is a very big reason why banks do not offer 100% mortgages, particularly to first home buyers (or people with no equity already) - does nobody else remember when they were doing this back in the early 2000's? What happened? Interest rates went up and property values took a dip - next minute people suddenly owed more to the bank than what their properties were worth and the banks called in their loans - I recall the pages of mortgagee sales in the papers at the time.

ANZ and National had a lender in the late 2000's called Countrywide who did a lot of 95% and 100% lending. They wish they hadn't! With no skin the game it's too easy to walk away when the going gets tough. Westpac also did high LVR lending over 100%, they wish they hadn't too.

jeffqv - 2020-12-15 22:29:00

The ANZ move will not help first home buyers at all. Stopping buying 65 inch TV's, going out 3 times a week for dinner and actually saving work as they always have done.

jeffqv - 2020-12-15 22:33:00

I don't think it will make much difference FHB's are out numbering investors 20 to 1 at open homes as it is.

superdave0_13 - 2020-12-15 22:39:00

Cosmetic change? Still a shortage of house, whoever owns them.

amasser - 2020-12-16 09:36:00

jeffqv wrote:

The ANZ move will not help first home buyers at all. Stopping buying 65 inch TV's, going out 3 times a week for dinner and actually saving work as they always have done.

Actually TVs have come down in price so much now that the cost is negligible. My parents bought a brand new 14" Sony TV back in the early '90s for $500, which was quite a lot of money now.

Now other non-optional costs like food, rent etc. have skyrocketed so it is harder to save for a deposit.

My parents were able to buy a BRAND NEW 3 bedroom house back in the '70s on a schoolteachers wage. This would not be possible now.

We bought a run down 3 bedroom ex state house in '08 with an 8% deposit, when I was on apprentice wages, and my wife was on office junior wages, and had pretty much paid off the mortgage in 8 years, however with the higher house prices now, it would be much harder to pay off the mortgage that fast as the house prices have risen much faster than wages.

My sister with two degrees on a Nurses wage really struggled to find anything she could buy this year, and managed to just scrape into a two bedroom unit in a rougher area of town, but she had to look for many months to find anything, and this was in Christchurch, imagine how hard it would be in Auckland!

tygertung - 2020-12-16 10:53:00

tygertung wrote:

My sister with two degrees

Doesn't mean much in terms of how much you earn. A friend of my girlfriend was complaining about the same thing. She was a teacher with two degrees and her zero tertiary educated firefighter (not with NZ Fire service) husband earned twice what she did.

sw20 - 2020-12-16 11:06:00

sw20 wrote:

Doesn't mean much in terms of how much you earn. A friend of my girlfriend was complaining about the same thing. She was a teacher with two degrees and her zero tertiary educated firefighter (not with NZ Fire service) husband earned twice what she did.

We must assume that the "friend" entered the teaching profession knowing full well what the pay rates were, that is they did not accept a teaching job and then when their pay package arrived got a big surprise as to how much it was or was not !!
What is the proposed "fix" for he above situation halve the pay of firemen or double the pay of teachers ??

onl_148 - 2020-12-16 12:27:00

Even though a Registered Nurse earns a reasonable wage, due to the out of control house prices, it is very difficult to get anything. Imagine if you lived in Auckland, they need nurses too, and those nurses need to live somewhere.

tygertung - 2020-12-16 13:44:00

tygertung wrote:

Even though a Registered Nurse earns a reasonable wage, due to the out of control house prices, it is very difficult to get anything. Imagine if you lived in Auckland, they need nurses too, and those nurses need to live somewhere.

eventually Auckland will have no teachers nurses or service people. It will be a city for rich people and their slaves won’t be able to afford to live there.

Talking to a guy this morning, his daughter and her husband are moving to Australia from Auckland, they couldn’t get a loan to buy a house despite earning over $200,000 a year. I guess there is no hope. New Zealanders leave, replaced by desperate foreigners.....

And today this.

https://www.stuff.co.nz/national/politics/300185131/governme
nt-forecasts-five-years-of-big-house-price-growth-but-theres
-some-good-news

No wonder the suicide rate is up.

Well, that about sealed this governments fate for the next election. Anything they say they are doing with housing is just white noise. No one wants to fix the housing crisis, they are all the same. SHAME ON THEM.

lakeview3 - 2020-12-16 14:12:00

its ok Lakeview, my daughter is returning from overseas to take up her old teaching position in Auckland in the New year. She'll be buying her own home hopefully soon after with her partner... good money to be made in Europe teaching. and with the exchange rate it worked out well for her.

Edited by heather902 at 2:33 pm, Wed 16 Dec

heather902 - 2020-12-16 14:32:00

heather902 wrote:

its ok Lakeview, my daughter is returning from overseas to take up her old teaching position in Auckland in the New year. She'll be buying her own home hopefully soon after with her partner... good money to be made in Europe teaching. and with the exchange rate it worked out well for her.

oh that’s alright then, your kids are fine too bad about those who haven’t even finished school yet - what kind of a future will they have?

Does anyone care????? ????

lakeview3 - 2020-12-16 15:24:00

#24, on $200k per annum and can't get a mortgage? There is something very wrong here, no deposit? bad credit? Can't think of anything else.

jeffqv - 2020-12-16 15:38:00

jeffqv wrote:

#24, on $200k per annum and can't get a mortgage? There is something very wrong here, no deposit? bad credit? Can't think of anything else.

well that’s what he said.....nothing surprises me. It’s very clear what the agenda is - turn all first house buyers into debt slaves so the older generations can continue to indulge themselves, I am ashamed to be an older person quite frankly and to see what is left for our kids.

lakeview3 - 2020-12-16 15:57:00

It wouldn't generally be worth living in Auckland any more due to it being outrageously unaffordable, but unfortunately, if all your family moves there, it becomes very inconvenient to live elsewhere.

tygertung - 2020-12-16 16:01:00

lakeview3 wrote:

well that’s what he said.....nothing surprises me. It’s very clear what the agenda is - turn all first house buyers into debt slaves so the older generations can continue to indulge themselves, I am ashamed to be an older person quite frankly and to see what is left for our kids.

Why should you be ashamed for being old? Sounds like a great big exaggeration.

Anyhow, you should set an example and give your fortnightly superannuation to a young'un. Perhaps that poor person on a meagre 200k could do with it.

Edited by johnston at 4:05 pm, Wed 16 Dec

johnston - 2020-12-16 16:05:00

Reading the first sets of comments, it is like the global financial crisis never even happened.

I don't think anyone is going to build cheap houses unless they are paid by the government in some way. If I was a builder and had the choice of building a house that was going to return me $50 -100,000, or two that would give me back $20-30,000 (numbers made up - I have no real idea), that is a pretty easy choice.

If the government actually does build those 100,000 homes, I think that would solve the housing problem for the next twenty years.

emmerson1 - 2020-12-16 16:21:00

lakeview3 wrote:

oh that’s alright then, your kids are fine too bad about those who haven’t even finished school yet - what kind of a future will they have?

Does anyone care????? ????

don't be so dramatic. what is it exactly that you want? it sounds like you want to bypass sensible decisions and hard work for handouts. the market is what it is. you either get on board with that, get your kids on board. stop spouting doom and gloom its boring as feck.

heather902 - 2020-12-16 17:25:00

heather902 wrote:

don't be so dramatic. what is it exactly that you want? it sounds like you want to bypass sensible decisions and hard work for handouts. the market is what it is. you either get on board with that, get your kids on board. stop spouting doom and gloom its boring as feck.

what’s boring is the successive govts doing absolutely stuff all to address the issue.

I mean where are all the cheap sections and box houses like you got the opportunity to purchase when you started out? I bet you didn’t have to compete with investors.

https://www.stuff.co.nz/business/opinion-analysis/300175287/
how-past-generations-pulled-up-the-property-ladder-on-todays
-youth

Pulling up ladders is TOTALLY a what it is.

Edited by lakeview3 at 5:38 pm, Wed 16 Dec

lakeview3 - 2020-12-16 17:38:00

onl_148 wrote:

We must assume that the "friend" entered the teaching profession knowing full well what the pay rates were, that is they did not accept a teaching job and then when their pay package arrived got a big surprise as to how much it was or was not !!
What is the proposed "fix" for he above situation halve the pay of firemen or double the pay of teachers ??

Increasing pay for teachers is not a bad idea at all. In Queensland teachers starting their career earn almost $80k, while over here that's the maximum they can earn after years of experience.

ps. I'm not a teacher.

v_shark - 2020-12-16 17:56:00

lakeview3 wrote:

what’s boring is the successive govts doing absolutely stuff all to address the issue.....

The Green Party has housing policy you probably like a lot. Marama for Prime Minister would do the trick.

artemis - 2020-12-16 17:58:00

Teachers used to be on the same salary as a back bencher MP, not so now.

When my parents bought their first house in the '70s, it was a basic brand new 3 bedroom house with no garage on a cheap section in Queenspark. This was easy to buy on a teacher's salary. My dad built his own garage.

This is not possible now.

tygertung - 2020-12-16 18:04:00

lakeview3 wrote:

what’s boring is the successive govts doing absolutely stuff all to address the issue.

I mean where are all the cheap sections and box houses like you got the opportunity to purchase when you started out? I bet you didn’t have to compete with investors.

https://www.stuff.co.nz/business/opinion-analysis/300175287/
how-past-generations-pulled-up-the-property-ladder-on-todays
-youth

Pulling up ladders is TOTALLY a what it is.

to be honest, you aren't allowed to build them as cheap as we did, the building regs are far more stringent now. and you'd have to agree that's a good thing.
Combination of low interest rates and low deposits for first home buyers has mean't many more first home buyers are entering the market... and the banks raising the deposit % for investors is another positive.
It is pointless banging on about days gone by, we have all demanded better in the way of housing standards, insulation, water tightness, environmental impact mitigation. etc and now we pay for it.

heather902 - 2020-12-16 18:12:00

tygertung wrote:

Teachers used to be on the same salary as a back bencher MP

That's about what they should be paid right now. It's not an easy job. I've had teachers in my life who've had a big impact on me and I'm sure others have as well.

v_shark - 2020-12-16 18:12:00

I flicked through quite a bit of Green Party policy and didn’t see much.

If progressive home ownership is what I think it is it’s a disaster waiting to happen and just acts to inflate prices. Anything that puts money into the market inflates prices what they need to do is take money out of the market (and start the spreading of messages along the line that property is cyclical, prices going down part of that process and needs to happen for a healthy future blah blah blah)

1) No using of equity to act as a deposit for buying a home, it’s got to be actual cold hard cash

2) No counting rents as income for the purposes of mortgage/property borrowing.

If Mr Smith wants to go and buy a rental that’s fine, he can earn the deposit in a legal way with money he can prove he has paid tax on (or inherited/won on Lotto etc etc) and he can’t count the rent as income for the purposes of calculating the amount he is allowed to borrow.

I’d like to see that stats but if investors are the problem that would remove mast of them BUT banks and non bank lenders have to play ball.

magicroundbout - 2020-12-16 18:17:00

tygertung wrote:

.....When my parents bought their first house in the '70s, it was a basic brand new 3 bedroom house with no garage on a cheap section in Queenspark. This was easy to buy on a teacher's salary. My dad built his own garage.

This is not possible now.

What's wrong with a 1 bedroom apartment or do up in a less than desirable location, to get on the ladder? DINKs saving hard could get a deposit in a few years. Several thousand first home buyers are buying each month, so not impossible.

artemis - 2020-12-16 18:21:00

What a lot of you fail to realise is that by indebting younger generations and making housing unaffordable for them, they will not be able to spend so much time with their kids who will grow up with almost absentee parents, if they have any, they will struggle to feed themselves and their kids properly because they will be so busy working to pay the rent in a house they could be told to leave at any time. Their kids may not be able to go to the same schools. Divorce, suicide, mental health and addiction issues, and crime will go through the roof and that affects us all - everyone.

All this because lack lustre selfish gutless politicians put themselves and their cronies first.

New Zealand’s best days are behind it. I predict another wave of people moving to Australia. Soon this country will be made up of rich people and serfs and nothing in between.

Edited by lakeview3 at 6:26 pm, Wed 16 Dec

lakeview3 - 2020-12-16 18:25:00

lakeview3 wrote:

Talking to a guy this morning, his daughter and her husband are moving to Australia from Auckland, they couldn’t get a loan to buy a house despite earning over $200,000 a year. I guess there is no hope. New Zealanders leave, replaced by desperate foreigners.....

maybe if they stopped looking at multi million dollar beach front houses in Milford and settled for the many affordable houses available they wouldn't need to head over the ditch ..

pf - 2020-12-16 18:32:00

pf wrote:

maybe if they stopped looking at multi million dollar beach front houses in Milford and settled for the many affordable houses available they wouldn't need to head over the ditch ..

there is a difference between not being able to get a mortgage itself and not being able to get a mortgage for x amount.

as for the $200k figure seems rather unusual..unless they have a lot of debt? our income is a lot lot less than that and even when we spoke to the bank to see roughly how much we could get a mortgage for even with 2 children and one income the bank said we could borrow x amount.

cathi - 2020-12-16 19:17:00

onl_148 wrote:

We must assume that the "friend" entered the teaching profession knowing full well what the pay rates were, that is they did not accept a teaching job and then when their pay package arrived got a big surprise as to how much it was or was not !!
What is the proposed "fix" for he above situation halve the pay of firemen or double the pay of teachers ??

I wasn’t proposing any fix nor care what they proposed to do about it. I was simply stating that lots of degrees don’t automatically equal big pay packets. The only degree that guarantees six figures day one out of Uni is dentistry.

sw20 - 2020-12-16 19:44:00

cathi wrote:

there is a difference between not being able to get a mortgage itself and not being able to get a mortgage for x amount.

as for the $200k figure seems rather unusual..unless they have a lot of debt? our income is a lot lot less than that and even when we spoke to the bank to see roughly how much we could get a mortgage for even with 2 children and one income the bank said we could borrow x amount.

apparently they had 2 kids and this was Auckland not Hamilton. My first house I bought in Auckland is now worth $945,000.......unaffordable...-
..and it’s in a s*** area, decile one schools.

I can see why they are moving, going to Brisbane apparently and they get paid more.

Edited by lakeview3 at 7:52 pm, Wed 16 Dec

lakeview3 - 2020-12-16 19:52:00

lakeview3 wrote:

apparently they had 2 kids and this was Auckland not Hamilton. My first house I bought in Auckland is now worth $945,000.......unaffordable...-
..and it’s in a s*** area, decile one schools.

I can see why they are moving, going to Brisbane apparently and they get paid more.

so they cant get a mortgage full stop not even for say $800k or they cant get a mortgage for the price range they want?

cathi - 2020-12-16 19:59:00

Or they can’t get a mortgage for a place large enough for them and their family close enough to work to make it viable.

We need to be able to accommodate all sorts of wages or else we will have trouble recruiting people to do a large number of jobs/loose well trained people overseas/find we are paying out ever increasing amounts of things like accommodation supplement.

magicroundbout - 2020-12-16 20:09:00

cathi wrote:

so they cant get a mortgage full stop not even for say $800k or they cant get a mortgage for the price range they want?

omg imagine having an 800K mortgage and you can’t even send your kids to a decent school.

That’s right, all the people who don’t even have kids at home anymore sit there in the ‘good’ areas on their leafy large properties within a cooee of the cbd and moan about the traffic as all the poor people with massive mortgages and kids drive little Johnny from some outlying suburb to a better school.

lakeview3 - 2020-12-16 20:30:00

magicroundbout wrote:

Or they can’t get a mortgage for a place large enough for them and their family close enough to work to make it viable.

We need to be able to accommodate all sorts of wages or else we will have trouble recruiting people to do a large number of jobs/loose well trained people overseas/find we are paying out ever increasing amounts of things like accommodation supplement.

accommodation supplement should only ever be paid to people living in homes they own, instead of lining someone else’s pocket.

lakeview3 - 2020-12-16 20:32:00

lakeview3 wrote:

omg imagine having an 800K mortgage and you can’t even send your kids to a decent school.

That’s right, all the people who don’t even have kids at home anymore sit there in the ‘good’ areas on their leafy large properties within a cooee of the cbd and moan about the traffic as all the poor people with massive mortgages and kids drive little Johnny from some outlying suburb to a better school.

Once upon a time those same people probably raised their families in *not so good* areas when they were finding their way on the property ladder. Don't begrudge people what they have worked for.

heather902 - 2020-12-16 20:40:00