That Home Loan Hub
Welcome to That Home Loan Hub, your ultimate guide to mastering the world of home loans and property. I'm Zebunisso Alimova, here to simplify the complexities of real estate and provide you with expert insights and the latest trends.
Whether you're a first-time homebuyer, an experienced investor, or simply curious about the property market, this podcast is for you. Join me each week as we unlock the secrets to property success and help you make informed decisions. Let's dive into the world of property together!
That Home Loan Hub
House Hunting? Why Now Might Be Your Golden Opportunity
Curious about the real story behind reverse mortgages and wondering if now's actually a good time to buy property? We're pulling back the curtain on what's really happening in the market based on our recent networking events, seminars, and conversations with industry insiders.
Reverse mortgages often get a bad rap, but they're not universally good or bad – it's all about context. We share a heartwarming story about how parents used a reverse mortgage strategically to fund their daughter's necessary surgery, with a clear exit plan in place. This exemplifies the ideal use case: addressing an immediate need with a defined repayment strategy. The key takeaway? These financial tools can be valuable when used as a last resort, but borrowing in your early 60s without repaying until your 80s can create significant compound interest that limits your future options.
For prospective homebuyers, particularly first-timers, the current market presents a unique opportunity. With more sellers than buyers, properties are selling at fair prices without the fierce competition of recent years. Many sellers are motivated – relocating internationally or separating couples who need quick sales rather than maximum profit. Combined with stabilising interest rates and KiwiSaver funds available for many first-time buyers, conditions are surprisingly favourable. Nobody knows how long this window will remain open – six months, a year? – but right now, buyers have more negotiating power than they've had in quite some time.
Have questions about reverse mortgages or wondering if now's the right time for your property purchase? Reach out to us – we're here to help navigate these complex financial decisions. Subscribe to our YouTube channel and follow us on Instagram for more insider knowledge and timely market updates.
Buy your first home in NZ Weekly Webinars
You thought it's not possible or the dream is too far away? Come to my webinar and I will show you, you are much closer to your dream, than you think you are!
Join Here - https://bit.ly/4m9SL72
Hello and welcome back to the Home Loan Hub. Today we are going to talk about the word on the street what's happening out there, what sort of stuff we're listening to, what sort of events we're going to, and to share some of that knowledge with you. So, James, hello.
Speaker 2:Yes, people, you heard it. First Word on the street with James Buchanan.
Speaker 1:I wish we had a video of that. Goodness James, you did such a good job awesome. What have you been up to in the last few months?
Speaker 2:I'm starting to get around to a lot of different networking events and seminars and stuff like that and webinars and so forth, and so I love asking questions about what's going on in people's businesses and what they think of various lending products, and one of the things anybody that might have been listening in the past.
Speaker 2:I have a bit of an interest in the reverse mortgage space, so I'm always asking you know what people think of them, because they have a bit of a negative association with them generally. But you know and I'm getting lots of pros and lots of cons, so my summary is that, generally speaking, it's a good product, but as a product of last resort, if you've got no other options and you're retired and you've got a freehold property and you've got no other way of getting the money that you need, a reverse mortgage is certainly worth looking into. On the other side of that, though, is if you're a reasonably young retiree in your early 60s and you take out 100 grand on a reverse mortgage and you don't pay that back until you're 85 or 90, that amount of debt is significant, and that's going to affect future decisions if you want to go into a retirement village or aged care or anything like that. So you've really it's a case-by-case basis on who it works for. You don't want to spend any more money than what you have to on the loan.
Speaker 1:You know it's interesting because, as you say, it does have a negative connotation. But then what do you actually borrow money for? That matters and one of the posts I've seen recently and I thought, wow, this is nice, this lady. She put a picture up of her hospital meals. She was in a private hospital and she put different pictures of the menus in that hospital. You could even order you know, high-grade wine in a hospital.
Speaker 2:Fully medicated, you probably shouldn't be having wine. That sounds good to me.
Speaker 1:But the menu was just amazing. It was like salmon and steak and this and that and people were going what you know? How did you get to the private hospital to get the surgery? And part of her post was saying thanks to my parents, they took a reverse mortgage on their house and to allow her to have the surgery that she needed. So the daughter got a surgery.
Speaker 1:The parents borrowed the money on their house as a reverse mortgage, and she mentioned in the post that her idea is that she will get better soon, she will go back to her high earning job and she will be able to pay that back for her parents. Or maybe she can borrow money against her house and pay back the parents and when the parents get older she'll be the one looking after them. So to me, this was the absolute case in point why we would need a reverse mortgage in place. You know the lady was in good position financially, asset-wise, but she just couldn't borrow the money herself. So her parents had to do it for her and it's not a long-term borrowing, it's a short-term solution for them, where they give her some money, give her the helping hand and within a year or two she'll probably pay it back for them.
Speaker 2:That's a wonderful scenario and it's exactly the kind of thing that we would want to support people in doing. If people were to come and talk to us about a reverse mortgage, we would be trying to advise them on, you know, making sure it's not a long-term mortgage, making sure there's some kind of exit plan. Like what you've described here. The daughter's going to get back to work and pay the parents back. That's what you want to see, rather than build up 20 years worth of compound interest Because you might have you don't know what you're going to need in the future. Right, if you're 60, when you turn 80, you might need to go to aged care or you might need to go to a retirement village or something like that. But if you've got this huge reverse mortgage, it's possibly going to stop you from doing that.
Speaker 2:So we've just got to look at them really carefully and make sure it's the right thing for each person.
Speaker 1:Okay, so you visited that seminar and they talked about that. What else have you learned, James?
Speaker 2:Gosh, that's a big question because you know I've only got a little brain, so not everything stays in there.
Speaker 1:We only have limited time. James, it's okay, you'll be fine. Just share two minutes of new updates.
Speaker 2:Really interesting conversations with people from the New Zealand Shareholders Association as well about.
Speaker 2:Obviously they're very pro the markets, but there's definitely a place for property within your investments At the moment it's you know, just reading the room a little bit it's a really.
Speaker 2:From our point of view, it's a really good time for our clients to be buying, because they've got those so many opportunities. There's what would you say, lots of sellers and not so many buyers. At the moment there's still quite a good turnover, but the prices are, you know, not moving at all. So you're paying a fair house fair price for a house at the moment, or perhaps even getting a little bit cheaper, but you don't have too much competition. You know you don't have these multi offers and stuff like that. So if you are a first time buyer it buyer I can't think of a better time, if you've got you know, to start talking to us. Who knows when it will change. It might be six months, it might be a year, but right now interest rates are low. Most people have got a bit of KiwiSaver, so there's lots of opportunities out there and you've got some pretty desperate uh sellers in some cases.
Speaker 1:Exactly Because a lot of people I know, for instance, they're moving to Australia, so they don't care, they just want to sell the house and move on.
Speaker 1:And you know, buy something in Australia, for instance, or go back to Europe or whatever, so, um, so there are different cases for that. There's also a lot of separations that we see, and in those separations again, they're selling. Usually they can sell a property because none of them want to buy another one out because of the memories. Um, yeah, so they just want to move on. So there are some really good deals out there that you can get. Um, awesome, james. Well, thank you so much for sharing. This episode covered reverse mortgages again, but if you've missed a fuller reverse mortgages episode, go back. A few episodes ago. James and I did a more In-depth, in-depth.
Speaker 2:I was looking I'd like to say in-depth. It may not have been. I was looking for that word.
Speaker 1:But if you do have any questions, feel free to reach out. We are here for you. We're here to help you. And remember, if you can subscribe to our YouTube channel and follow me on Instagram, that'd be most appreciated. Thank you, goodbye.
