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
From Rugby Legends to Dance Floors: Our Team's Award-Winning Conference Experience
Fresh from winning the "Most Engaged Team" award at our national conference, mortgage advisor James Buchanan shares valuable insights that directly impact homeowners and buyers across New Zealand. This engaging conversation reveals how the connections we build with bank decision-makers translate into real benefits for clients, especially in those crucial moments when a mortgage application needs extra attention or an urgent approval is required after winning an auction.
James, our team's economic enthusiast, delivers an insightful forecast about interest rates that homeowners won't want to miss. With two more OCR cuts anticipated before year's end and fixed rates finally dropping below 5%, he explores strategic decisions about when to fix and for how long. The contrast between today's rates and those from just twelve months ago provides perspective on how dramatically the lending landscape has shifted, while cautioning that we may not see rapid economic growth in the immediate future.
The most valuable takeaway from our discussion focuses on the importance of personalised mortgage strategies. Through real examples – including a revealing story about a $9,500 break fee one of our own advisors faced – we demonstrate why cookie-cutter approaches to mortgages simply don't work. Whether you're planning a family, considering selling within months, or looking for long-term certainty, your mortgage structure should align perfectly with your unique circumstances. Listen now to gain clarity on navigating today's mortgage environment and connect with us to develop a strategy tailored specifically to your goals.
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Hello, welcome back to that Home Loan Hub. I am joined by James Buchanan. Hey, James.
Speaker 2:Hey, that was awesome, by the way.
Speaker 1:I'm in the party mode because we've just come back from the conference.
Speaker 2:Okay, I'm still recovering. I love it that tells Because we worked so hard.
Speaker 1:That tells who worked hard and who had a good time. James, I did an episode with Kunj about her highlights and takeaways from the conference that we've had and how it will help us to help our clients more. Let's dive into your perspective of the conference. It was your first conference.
Speaker 2:It was, yeah, I was really impressed. So the speakers that we had come and talk to us really delivered some quite insightful messages that will help us with our clients, that we can relay to clients about perseverance and overcoming what's that word they used Overcoming?
Speaker 2:adversity, Adversity that's the one. So, yeah, it was really good and we got to network with a lot of other franchises from different parts of New Zealand. We listened to Sir Graham Henry give his talk about, you know, losing that Rugby World Cup and how he overcome it. You know, getting knocked out in the quarterfinals. So, yeah, no, I really liked it and there were some great dance moves out there I never imagined I would see you on the dance floor.
Speaker 1:I hope your wife is not listening to this.
Speaker 2:I think she's suspected honestly.
Speaker 1:Every episode I record with you. I say that I hope your wife is not listening yeah, oh no hi, rebecca, um awesome. So for me I feel like you know, we showed up there as a team. We won the team spirit award yeah, of the conference most engaged team, I think most engaged team and for me it was awesome to see, because I am proud of you guys, I am proud of the work we do with our clients and I think it's it was awesome to see how engaged you were with the speakers and how much information you were soaking in, so that's incredible, and I know you've made some connections with bank managers as well.
Speaker 2:Oh, absolutely. That was really good, because it's quite important to get to know them.
Speaker 1:Why is that important?
Speaker 2:Well, if I have an application and I'm not getting the right result that I want from the person that's assessing it, if I have an existing relationship with the BDM from the banks, then it feels like they're much more approachable for me to explain outside of the case if I think it's a strong case. So just getting to know those people that are doing those roles and having pretty informal conversations with them, that was really cool. I really enjoyed that.
Speaker 1:Because those people you know, it's awesome to get to know them in that relaxed environment because they play a crucial role, like when we have a client that just won an auction or gone unconditional, you know, and needs an outcome right now, these are the people we call. Or when something goes absolutely horribly wrong, these are the people we call and these are the people we call upon the favors you know, and we ask them to make things happen for us. So it's incredibly important to get to know them and build those relationships with them which, you know, I've been in this industry as an advisor over seven years, and then I've also been in the bank for over seven years as well. So in total, I think I've been in the industry for about 15 years now.
Speaker 1:And I've managed to build those incredible relationships that came to my rescue many, many times when my clients needed it, so it's awesome to see that that was a really good takeaway for you as well. Now you're also a little bit of a nerd in our team, James, I'm sorry to say.
Speaker 2:I'm the smart one.
Speaker 1:You're the smart one. I love that. I love how you see, and that's what I mean about you. You always can turn the situation into a positive outcome, so I call you a bit of a chief economist. Now, what's your outlook?
Speaker 2:reading the you know Reading the tea leaves of what other people write.
Speaker 1:Yeah.
Speaker 2:Well, generally speaking. So I do listen to. I know we do this podcast, but I really enjoy following what the economy is doing and it just overlaps, obviously, with our work here. So, listening in, it's becoming pretty clear there's going to be another two official cash rate cuts, so we can expect one in October and another one in November before the end of the year. This is generally what most of the main economists from the banks are saying. Things you know we're in a trough with the economy, but there are slight signs that things are just slowly improving like just very small signs.
Speaker 2:But it's nothing to get too excited about yet and we don't. Generally speaking, it's not going to be a rapid growth phase. We're going to be operating in the scenario of low productivity and low growth for a little while, at least the rest of this year. But those two further official cash rates weren't originally scoped in. If that makes sense, they're a bit of a. That's only really come about in the last two or three weeks since the last official cash rate announcement so we could see interest rates go a bit lower.
Speaker 1:Which would be absolutely amazing for a lot of households and their bottom line.
Speaker 2:Yeah, yeah. So and it becomes a call about when. How much further do you think they will fall? How much you know, if there's two more rate cuts by the Reserve Bank, how much will that impact? You know the fixed interest rates that we are offering.
Speaker 1:Well, we're finally under 5% right, yeah, see that I mean the two-year rate is 4.72%.
Speaker 2:Yeah.
Speaker 1:And a year ago, this time we were sitting over 6%.
Speaker 2:Yeah, it's phenomenal. So it becomes like a. You know, it's a bit of a game of strategy, isn't it? Let's see how low they go over the next couple of months. The thing is they might go low and then, if things pick up, interest rates may increase again during next year. So it could be what I would be. Quite depends on your situation. But what I would be quite keen on is, once those rates get higher under 4.5 or something like that, it might be quite good to lock it in for a decent amount of time.
Speaker 1:You know it's interesting, I've locked one of my loans. A couple of months ago I thought, oh, you know I'm getting a bit stressed out here because I've got all these loans right. They're coming up for a refix and one of my loans I fixed for two years. It was 4.99 for two years. I thought's a fantastic rate. You know I'll just go with that. I'll take a risk, calculated risk. I fixed some for six months, some for 12 months, some for two years, and so the one that I fixed for two years.
Speaker 1:I rang up the bank to find out what my break fee will be and the break fee is going to be nine and a half thousand dollars and I was like, ah, yeah, no, let's just leave it. But it's like, ah, yeah, no, let's just leave it. But because I did the quick math and I thought, oh, it's not actually worth it right now. Yeah, it's a big number. So something to watch out for you guys. Before you fix, very important to talk to your advisor because we will have ideas whether it's a good rate, whether you know it's good for your family or not. Like I've got a family, for instance, they're about to have a baby and she's not going to go back to work for the next five years and she wants to know exactly how much she's going to pay for the next five years.
Speaker 2:So fixing for five years works for them.
Speaker 1:But then someone wants to sell a house in six months. It's not going to work for them.
Speaker 2:Absolutely, and I found that out recently when I sold my place before, about a year before the fixed term was up. I forgot to calculate that into my forecast and it does make a pretty big dent.
Speaker 1:That's because you didn't have an advisor back then.
Speaker 2:Yeah, I was advising myself, unfortunately.
Speaker 1:But now you've got the professionals around you.
Speaker 2:It just goes to show you, though, that when you're in the moment yourself and it's the same when you're looking at a property you've just got to make sure that you are really focused on what you're doing, and that's our job is to make sure that the clients are focused on what they should be doing.
Speaker 1:Absolutely Awesome, James. Well, thank you so much. It's been awesome to have you on the show today. And for those that missed out on the episode that I did with James around the property market and first-time buyers, go back a few episodes ago and have a listen.
