You're listening to the Weekend Collective podcast from News Talks.
I'd be.
As welcome back to the Weekend Collective. I'm Tim Beverage. Now, by the way, if you've missed our panel, or if you do happen to miss any of the hours you have to nip out or something you think I want to catch the end of that, you can go check out our podcast on the Weekend Collective. You can just go to the News Talks website or iHeartRadio and we get the hours loaded pretty quick after they've concluded, so
you can jump on that anyway. Now it's onto the One Roof radio show and we're going to have a chat about now that the interest rates the cash rates dropped another twenty five points and things seem to be getting to that feeling where maybe this is sort of
roughly where we're going to. And so the question around making commitments, but also how should you actually structure your mortgage if you're looking to refix your mortgage or you wait, you're going to float for a while while you wait for another announcement, or and at what point isn't worth breaking your mortgage at the lower rate, But just the
whole question around restructuring. And I mentioned this partly because I've just recently restructured my mortgage and there was a bit of a miscommunication with the bank which did cause a fair wack of stress. But to be fair to the bank, they actually have said, look, if that's what
you understood, we're going to sort that out. Somebody might say, well, you should have talked to mortgage broke about I guess there wasn't enough money at stake really, But anyway, we're going to talk about fixing your mortgage in the ways
you should restructure your mortgage as well. But also if now is the time when things are getting to a point where the interest rates are sort of settled, we're not going to We don't think we're going to see too much of a shift because we've seen some certainly seen a roller coaster lately. I want to know what it takes to go from being on the sidelines looking at things thinking I'd love to do that, love to
buy a house, maybe we should do it someday. What did it take or does it take to change your mindset and what clinches it for you or has clinched it for you to take your first step into property now somebody who's talking about that stuff all the time because she's from Property Apprentice, she's an investment coach and her name is Debbie Robertson. She's with me. Now get a Debby. How you going good?
How are you good?
Do you find I mean, do you get the feeling that it does be on what we weekend into that time with interest rates that it's sort of you know, you've got nothing else to wait for. We're not going to really see a hell of a lot more movement, are we, Or do you sort of think, well, don't make those predictions, beverage. Who knows what's going to happen.
Honestly, this is where you wish she had a crystal ball, because there's so much volatility going on in the US at the moment that literally anything could happen. The New Zealand Reserve Bank has indicated that the next now and next announcement is going to be another cut of zero point twenty five, so you know there is room for things to move. The longer term interest rates are the ones that are affected by overseas, so you know, if we get inflation in the US, then we could get
more drops in the long term interest rates. If we don't get inflation in the US and the economy stalls over there, then we might see we might see further cuts. It literally could go either way. So who knows.
Okay, Yeah, because I had, for some reason assumed that this was sort of getting to. Maybe the reason I'm thinking that is because we've got to what we might anticipate to be a fair, manageable sort of rate of mortgages.
Now, yeah, we're definitely below the long term average. I mean I worked out the ten year or twenty year average up to the start of COVID when the Reserve Bank slashed the OCA, and it works out to be about six point three five percent on average. So everything except for the floating rate is now bel the average, and floating rates came down almost immediately after the Reserve Bank announcement.
Actually, I noticed with my bank that their one, two, three year rates didn't change. But there in fact, when I was talking to them about the issue I had, they said, I said, by the way, is this going to work in My favorite said, no, there's no change. You said, You've got a pretty good rate, which I do, but he said, the floating rate's going to come down.
Yeah, the floating rate, and interestingly, the test rates have come down as well. So test rates are the interest rate that banks test your affordability. Yet so now most of them are sitting around the seven percent mark, whereas you know at the peak of the market they were testing at around nine percent.
Why well, why say they saw around so much?
It's a safety imagine. So you know, banks have got this responsible lending code, so they need to make sure that you're going to be able to afford to pay the mortgage if interest rates or when interest rates go back up again.
So there was a time when, you know, when the market was going nuts, and there have been a couple of times obviously when money was really cheap with the FOMO years, and you know, when it seemed that if you could get the leverage, you were a dummy not to get into the market, although were plenty of people who didn't, but nobody really considered the safety margin themselves. All they wanted to do is can I get the
mortgage away we go. I had some advice from a friend saying, look, you, when you do get a mortgage, you should always make sure that if interest rates, if your mortgage rate gets to eight percent, that's a number he packed. He said, you should always become confident you could hang on. How important do you think it is that we consider safety margins absolutely well. I don't know how many people do. How many people do I don't think anyone does. They just go what's moment mortgage rate?
Lock it in for four years, happy days.
Yeah, And it's one of the things that we always talk to our clients about is testing your own affordability, because just because the banks is you can borrow a certain amount of money doesn't mean that you can actually afford it. So always test. I'd suggest testing at interest rates of around seven and a half or seven percent, because what we've seen over the past few decades is the interest rates have been coming down over the you know,
but they have been trending lower and lower. The COVID rates were way abnormal that I certainly wouldn't expect them to get that low again.
But I wonder if there's anyone who's still smugly just coming to the end of that two point nine nine percent, what did you get down to? Was it two point nine or was it.
There were a couple at two point five and two point nine yees, So we've still got one of those.
I'm sure you have personally. Oh, just scouting right now.
I know.
Actually, we'd love to hear from you when you come to about this. When you're when you're organizing your mortgage, what do you test yourself out on, because that's a part of the that's the whole part of the equation. Maybe the bank's testing your your ability to service a debt. But I think I've found that what the bank thinks I can afford as a hell of a lot more than I'd ever want to pay. Absolutely, so we love your calls. I know what undred eighty ten to eighty
tixt nine two nine two. And the other thing about structuring mortgage is how many people actually would go initially onto a floating rate simply just because they're like, well, I'll wait and see what happens the next little while.
I think at the moment, more and more people are looking at fixing. You know, we went through a period where there were a huge number of mortgages that were on floating rates or just six month mortgage rates, and now people are starting to look at the longer term rates as well. I think my opinion has always been even before I became a mortgage advisor. Why do it yourself if you can get someone who's in the industry to do it for you. Tom Wow.
Actually the reason I didn't because mine's got down a bit and I just assumed. In fact, I did speak to a mortgage broker a couple of fixes ago, maybe a couple of years ago, and he just he said, what are you What are you being offered by the bank? And I said X And he said, just go with the bank. You know that's as good as I'll get you. Must, well just do that, mind you. I wasn't looking at restructuring anything.
No, And I think that's the thing, like, if you've got a good mortgage advisor, they're there for you for the entire duration your mortgage. Whereas you know, often if you're dealing with the bank, you see a different person every single time you go there, or you might not even see someone these days, you just talk to them.
How does that work out from a mortgage broker's point of view? If you've you've had your own mortgage, you've managed it yourself, and you decide you want to go to a broker, how does how do they end up getting paid because you've got an existing you know, been doing things with the bank. You're not changing much, but you're going to get a mortgage broker to help you do They just how does that work?
There's a couple of different there's a couple of different methods. Basically, if it's something like an interest rate review, the banks either pay you a little bit to do that to service the client for them, or you get you know, I mean sometimes that happens. Other times the banks have what they call a trail commission, so you get paid a little bit each month in order to continue looking after that client.
Okay, we love your callse We one hundred and eighty ten eighty around. How do you approach restructuring your mortgage? And I mean you might have learned a few lessons like I did the day about making sure I clearly understood what the bank was talking about until there's a misunderstanding, because that can be quite stressful, and not going to talk about that too much because they have sorted it out. Debbie. So what is the when people come to see you
property apprentice? I mean, actually how I think? Just out of curiosity, how are you getting busier these days? What's going on?
Yeah?
Last year definitely started to pick up for us, you know, I mean, we went through a couple of years where it was a bit lean, so we were just looking after our existing clients and the odd new ones that were seeing the opportunities out there. So last year definitely started to pick up. This year has been a little bit slower to start, but certainly starting to pick up
now as well. So I think one of the things that we've always seen in the property market, because I mean, Paul and I have been in the industry for a quarter of a century, but you know, we've been running Property Apprentice for about fifteen years now, and one of the things that we've always seen is that the gen all public start getting really interested in property investing when we're in a booming market, and yet most property investors would far prefer to be investing in the current property
market when there's less competition from other buyers. You can negotiate good deals without feeling like you've got to make a decision in a hurry. But you know, we're a nation of sheep.
Are people who come to you are they coming as investors you've ordered or first home buyers? How does that?
It's really interesting because that's something that we've definitely seen a change in over the past few years. You know, when we first started Property Apprentice, it was mostly investors. Now where we get a mix of first home buyers who want to invest further down the track and experienced
investors as well as brand new investors. And I guess part of that could be because we've kind of changed the way that we do things over time as well, so now we incorporate the full financial plans and you know, time planning and all that sort of stuff as well. So I guess our clients get a bigger base rather than just coaching.
So you're not really dealing with first time buyers so much.
Yeah, we're dealing with more first home buyers now than we did when we first started. So yeah, it's quite interesting because we're seeing the younger people that are looking to purchase their first time they want to make sure that they do it well so that they've got a good, solid foundation to move forward from there.
I guess with you with your business, when people come to you, they've already made a decision. They want to get into the property investing, don't they. Yeah, So it's not so much a question because one of the things I wanted to explore along the lines of the restructuring mortgages is what does it take for people to go from the mindset of watching or maybe having a casual curiosity and something to actually going I'm actually going to
do it. Because I mean, even with me, it hadn't been for my wife saying to me, look, we're starting a family, we need to let's look at buying asean. That extra impetus for me was what made the difference. Probably whereas I'd been sitting you know, you'd think I should do this, I should do it, I should do it, and I think we whether it be property, people have those moments in their lives with all sorts of things. Yeah, about making it because it's a commitment.
Absolutely. One of the things that we've always noticed is for the clients of ours that are first home buyers, Oftentimes they start looking at purchasing a home either because they're looking at having a family and they want to make sure that you know, they can set down routes in a house that they can stay in for a while without having to worry about the landlord selling it
or whatever. Sometimes it's because market rents get to a point where they're like, heck, you know, we may as well just buy ourselves a home and start paying towards our own mortgage rather than helping the landlord pay theirs, which is fair enough as well. So yeah, there's a real mix in the first home buyer market for property investors.
It tends to. I mean, property always does well when there's lots of uncertainty like we're seeing at the moment in the US, because share market starts looking a little bit wobbly, so people look at things that are a bit more stable, like the property market or gold or you know, precious metals, all that sort of stuff. So yeah, property is a much more stable, Like we don't get the daily ups and downs like the share market does.
I guess it probably doesn't. Emotionally, people don't feel like it's been that stable lately because we've seen all those interest rates things. So how does the global situation time to a sense of stability when we don't know? I mean, job stabilities, job stabilities, you know, recessions, global recessions. Those are things that feed instability for people's towards.
Any definitely, and I think that's potentially the biggest reason that we don't have a lot more buyers in the market at the moment. I saw a survey recently that said, I can't remember the figure off the top of my head, but it was huge. It was like sixty five or seventy percent of New Zealanders are actually worried about job loss at the moment. Yeah, it was huge. So if anyone remembers what the figure is, let us know. But
it was it was high. And I remember thinking at the time, that's you know, when when we're looking at public perception like that, it's no wonder we don't have more buyers in the market at the moment, because who's going to go out and buy a home if they're worried about losing.
Their job, I guess, except the only other thing is you are paying for accommodations somehow anyway. But of course these days, generally your mortgage is going to be more than your share of.
The rent in most situations.
Yes, look, we'd love to have your cause on. There's a couple of things we're looking at about. It's about restructuring the mortgages and you know, have you I mean, for a lot of people it's something where they might go, well, I'm on this interest rate. Interest rates have dropped through the floor. I want to talk to the bank about about restructuring and maybe breaking my mortgage in fact, on
that just before we go to the break. How often do people actually make that calculation and how ba does it go for them with the banks when it comes to breaking an existing mortgage rate.
People don't often do that calculation themselves, but it's certainly something that mortgage advisors will do for you, and the banks will tell you how much a break feel cost you. So if you if you weren't wondering what it's going to look like, phone your bank up and say, hey, if I break this fixed rate now, how much is that going to cost? And then you can work it out yourself if you're that way inclined.
Actually, I did my calculations on our mortgage on what these scenarios were with using AI because I've I've got a conversational chat GPT excellent, and I said, this is my mortgage, this is what I've got to pay off it. How much will I save if I pay it off in this fashion and such and such, And I've got a very conversation. It's an English English woman's voice that comes up. Good question, Tim, I'll tell and actually ais certainly,
of course it does say double check everything. But yeah, actually, before we got to the break, let's take a text here. Hi, Tim, can you ask Debbie if there is an age limit on mortgage to buy an investment property. We're in our sixties, no mortgage, but we want to move to another province in a year or so. Could we get a loan and rent the property out our age?
Yeah, as long as you've got enough provable income. So when you already own a property, banks are still often quite happy to lend you money as long as you've still got provable income, so they don't have to worry about how you're going to pay the mortgage, you know, and they'll take a percentage of the rent. If you're buying an investment property, they'll take a percentage of the
weekly rent and add it to your personal income. But if you don't already own a home, if you're in your sixties, you might be lucky to get a fifteen year loan term, whereas if you already own your own home, you could still potentially get a thirty year loan term on an investment property.
Right, we'd love your cause eight hundred eighty, eight hundred and eighty ten eight. If you've got any questions for Debi Roberts from property from sorry proper apprentice, then give us called eight hundred eighty ten eighty. But also what clinched it for you to take your first step into property? Because it feels to me that we are at a time when there might be a few people saying In fact,
I'm not just saying that because I reckon this. I have had a conversation conversation with some younger people, a couple of whom have said, you know, I'm getting my money together. I'm thinking actually that we're going to find out what we can borrow, and we're going to start making a decision. And the reason for them is simply that they think this is the time to buy. I guess, but what was it? What was it for you that
clinched your decision to make the biggest of commitments. Some might argue eight hundred eighty ten eighty text nineteen nine two back in just a moment, news talks, he'd be it's welcome back to the weekend collective. This is one roof Riddy Issha. My guest is Debbie Roberts from Property Apprentice.
We're talking about ways to structure your mortgage, so maybe you don't even need to break it for a lower interest rate, because they're all sorts of ways to skin a cat, as they say, because a lot of people. I have this idea in my head that a lot of people, when they get their first mortgage, Debbie as they just go right and borrowing god knows what. Let's say four hundred thousand dollars just for fun, which would be quite a low mortgage for a first time buyer.
Depends on what you're buying.
But yeah, yes, I'm thinking Auckland. But I would imagine most people just go, well, what's the lowest interest rate four hundred grand, let's slap it on that and take the best rate we can get. But is that quite common form?
I think that's probably quite common with people that go directly to their bank. Someone who's getting a bit of good financial support behind them or financial advice behind them would generally look at splitting your mortgage so that you could have some of it on short term interest rates in the hope that interest rates keep coming down, and then maybe look at fixing some of it for a longer term for long term security.
Okay, we might have dig into this bit more about how you constructure it, because there are suggestions from people that if you structure your mortgage the right way, maybe you don't feel the urgent need to break it to refix it at a lower rate, but of course, depending on how much that's dropped. But let's take some calls Ray.
Hello, Oh, no, good.
Afternoon, Debbie. We're coming up to sixty five and we've got a mortgage that comes off principal and interest only next year with the five years in June, we need to refix again. I'm tossing up whether I'll do half a six months and half at a year, but I'm just I still want to stay interested only after next year. What is the likelihood of the banks allowing you to continue to do that.
That's a really bad chank. Yeah, it's really good.
Yeah, because I was. We're in the same situation we didn't interest only in the bank said times up.
I mean, like, that's that's exactly it. So eventually the banks will say no, that's enough, you've had enough. Prior to the global financial crisis, you could just roll over interest only loans for as long as you wanted, you know, as long as you still meet their lending criteria. But now things are a little bit different, so it will depend on your ability to service the loan and whether
you're able to refund to another bank. So yeah, I think go talk to a mortgage advisor and just have a chat about what your options are.
Yeah, because I'm thinking that I don't want to fix the loan more than past the interest only period, because if I do decide, you know that we can't get principal and interest, then I'll pay a lump some of it and make it affordable. Is principal and interest?
Yeah?
Have you got a lump sum to pay off it? Yeah?
Yeah I have.
Yeah.
So I mean you're you're right if you're coming up to an only expiry period and you fix for longer than that on a fixed interest rate for long some banks won't even let you fix for a longer term than your interest only expiry date. Some banks will, But if you fix for longer than your interest only expiry date, you can get yourself into a little bit of trouble because the bank haven't force you on onto principal. Yes, So yeah, I think it worth while you talking to someone.
Yeah, I want to hold that bit over us, because we could pay it off if we had to by selling another property or you know, paying a fairly decent lump off. But I prefer it to be honest as a stay interest only, because I've always gone of the thing that it's just interest only. And when I've got a lump some, I pay a lump some off it. Then generally I pay them off within you know, seven or eight years.
That's an interesting one. So if you are paying off lump sums in the bank as you can, I think Ray's probably not a bad situation because it's not like she's interest only and that's all she's got. If she's got other assets and things. I mean, is that a hard sell to the bank.
No?
No, And this is why this is why I love doing what I do, you know, because literally every single person I talk to is in a different situation. So it keeps the gray matter ticking.
So what's your ideal world as you'll continue with interest only?
And yeah, you're probably prior to you know, all the fuffle that's happened in the last few years. When we first bought this property, it was making thirty thousand dollars a year profit. It's gone to making thirty thousand dollars a year lost now because of the change in the interest rates. But with the interest rates coming down, it will almost be break even, could be break even. So to me, where I'm working on is that it's an
assets for my children in the years to come. If I can keep it just ticking along and I'm not having to add to it and we're just relying on capital gain to eventually become part of their inheritance, then that's the way to all that. It's not anything.
And have you crunched the numbers to see how much the mortgage would be if you did make a lump sum off it.
I've done it. I've done it at a few different levels. I don't need to pay that much of it. It is a big mortgage, but the property does return sixty three thousand a year itself, so it's doing.
Pretty well good.
So you I guess by not paying anything off, you're just banking on the capital gain being worth it rather than paying money off it and saving that interest.
Well, yeah, there could be capital gain, they may not be, but it's just looking after itself, you know. And it'll just be an assets that sits there dog looking after itself in morebetuity that someday, some day my kids could cash in, okay, and you know, there could be a capital profit. It could be a little lost, but I would think I would hope that I'm going to leave at least another teen years and there'd be a little bit of profit in it.
Yeah, okay.
I mean we've certainly found in our experience that property investing has given us a lot more choices than anything else. You know, with that ability to ability to have long term capital growth as well as long term rental increases over time as well, your purchase price doesn't increase, does it.
I'm one of those terrible ones that I don't incrustate much. You don't believe we just don't increase the.
Well you plas on a lot of bit of love.
You know.
That's that's good.
You know.
We're not all awful hardly.
Well that's what that.
Well that touches me out in my pocket.
Yeah, thanks, Ray, thanks for your call. That touches on something else that actually if you've got a good tenant that actually actually is worth something, if you've got a tenant who's going to be absolutely reliable. You're going to know, you know, they're going to be sticking around for a long time. I mean that is there is a reason why landlords would not want to be good to a good tenant like that.
Absolutely, and a lot of landlords that manage the properties themselves, they do get quite a bit behind and market rent, you know, so the tenants are paying pretty cheap rent compared to what they would be if they were renting anywhere else.
See the emotional journey I went on just before we take our next caller is because I liked having I paid a lump off my because of some other things I'd done. I had a bit of money sit in my business account and I thought, well, I wouldn't mind using that at some stage, but it's no point having it sitting there on some pathetic interest rate when it's actually worth a lot for every week that it's paid
off on the mortgage. And it was a difficult thing to get my head around though, because and psychologically I don't feel I've got that money there anymore to draw on, even though I've arranged it with the bank where I can draw on it. It's just that, you know what I mean, it was just nice seeing it sitting in that separate accountant and the chat GPT even said, you're going to save so many thousand dollars a year if you stick it on your mortgage Chat GPT.
Jeepers, are we really going to trust chat GPT to give you the best financial advice?
No, just pointed out the numbers. I just said, if you pay it off, this is what you're going to say per yeah, and interest rates, and if you pay it off your mortgage, you'll pay off your mortgage this much quicker.
Did it tell you what your break fees would be if.
You well, well, I don't think I probably.
Shouldn't have this conversation.
No, no, no, no, no no, because the break feeds weren't relevant. It's a year and I've got a floating sort of Oh it was floating.
Okay, Yeah, I mean, like you know, talking about loan structure, if you've got lump sums of cash, there's lots of different ways that you can help use that to your best advantage when it comes to having a mortgage. It could be a revolving credit facility, or in your situation, if you liked having the money sitting in a bank account and so that you could see it at any given time. Well, but you've got set mortgages. Offset mortgages can work really well in that scenario as well.
And you've explained that to me on the break. We'll be back in just a moment. I actually know. I went back in just a moment. We go to Bell good A, Yeah, good mate, how are you good? Thanks?
Yeah, good. Look. I'm seventy two, my wife sixty seven, and we own our home outright, probably worth about between five fifty and six hundred. We have about thirty odd thousand, you know, fucked away for emergencies. But my wife may have to have an operation and you go private, it's going to cost about twenty grand, and so we won't have much left for having the odd holiday. What's what's the best way to, you know, to maybe get forty or fifty grand? Is it re mortgage or reverse mortgage?
What would you suggest?
Well, I'd be yeah, I feel like a bit of a broken record saying get in touch with the mortgage advisor because they can go through all those different options with you. I can't give anyone individual financial advice in this sort of format because I'd need to know.
People in a similar situation.
Generically speaking, Yeah, I don't have any problems with reverse mortgages. I think there's definitely a place for them. It basically it depends on whether you've got the ability to repay the mortgage now or if you don't. So if you've got the capacity with your cash flow to pay off a mortgage, you know, a thirty thousand dollars mortgage isn't huge, so you know, you might be able to pay that
down without impacting your lifestyle. Otherwise a reverse a reverse mortgage might suit you right down to the ground these pros and cons.
Yeah, Yeah, that's I was leaning towards the reverse mortgage because then then there's no payments till you sell your house. Yeah, exactly, And if you work out the you gain maybe over ten or fifteen years whatever you take the loan out for. You know, I was sort of thought, well, even at the end of that term, would still have the same equity as we have now. Yeah, yep.
And I mean I think that the way that reverse mortgages are done in New Zealand are pretty pretty well looked after. You know, they're a pretty good facility.
Okay, good luck with that belt Chiers. Thanks for your call. We're back just a moment. It's twenty one minutes to five.
You love me.
You can see understand these devils, you can see what about you stalk said be this is the one Roof radio show. We're talking about how you structure your mortgage, and as we've dug into it, this has got a lot more complex than I anticipated. With Debbie Roberts from Property Apprentice, First thing, Debbie, Actually I want to ask you just for people who are setting out. So most people think, you know what you You've got your deposit, you've managed to get approval from the bank, you're going
to borrow. Let's say you're borrowing four hundred thousand bucks and you shove that all on one mortgage? Is that the right thing to As I asked this, I know and not one size fits all, but most people just do that. I've got a good interest, right, It's I can pay off something when I come off the fixed term, and so that'll do me. Is that generally an okay thing to do? Or what other options should they explore?
So should they structure their mortgage from day one differently to give themselves more flexibility?
I would say so yeah, So it depends on what your situation is like. If you're someone that earns bonuses or commissions, you know, lump some amounts as part of your salary, then that could lead itself towards a different type of structure. You might leave some of it on a floating rate, or you might have a revolving credit facility or an offset loan, or you know, there's lots of different options out there, and it is one of the things that a mortgage advisor can look at and
see which banks the best suited for you. Something that I actually heard recently which shocked me was that about sixty percent of New Zealanders thought that you had to pay to work with a mortgage advisor. And you don't if any of the listeners out there are going, yeah, but why would I pay a mortgage but you don't have to. I get paid by the lenders.
My understandings, mortgage advisors are a lot more commonly used these days. I think the perceptions of them have changed over the last ten or fifteen twenty years, haven't they.
Yes, they have. So it's you know, my preference has always been to work with a mortgage advisor because they've got access to over twenty different lenders.
So an example might be if you've got a four hundred thousand dollars mortgage, you might decide, well, to me, I can only talk for myself, and that's this is not what my mortgages. I'm not giving anyway family secrets here. But say if I had a mortgage of four hundred thousand dollars, I might fix, say for a year or two, the three hundred and fifty thousand, and I'd have fifty grand on a floating facility, and I would make sure I put it. I just ran every bit of money
that I had coming in into that account. So maybe that would reduce quicker. And if it didn't reduce quicker, then in a couple of years, I've still got the option of refixing that other one and consolidating them all or doing whatever.
Yeah. Absolutely, And I think at the moment there are some longer term rates which are starting to look a bit more attractive. So yeah, I think a mix of splitting your mortgage up can be quite a smart decision, depending on what you're looking to do long term.
So a way of looking at it would be, say, for instance, if there was a really cheap rate for five years. Oh, I would look at what I'm what, I don't think i'll ever pay off within five years? What's my mortgage going to be in five years time? Minimum principle? And I'd fix that amount on five years and then play around with the other stuff.
Yeah, I think that sounds like a good idea. That's certainly a good strategy.
How complex can you go with this stuff?
Oh man, we can have some serious fun with this.
Yeah.
I mean, obviously not everyone loves talking about mortgages, But find me a mortgage advisor that doesn't.
Actually, no, No, I think the reason they'd be fun to talk about is that when you have a conversation, you realize the flexibility it gives you for your life choices as well having a floating facility, perhaps because you're thinking, okay, we might not quite have saved everything for that family holiday we've promised ourselves in four years time or something, or just how much you're going to save if you restructure, if your structure your mortgage in this way, how much
you might potentially pay a few mortgage using offsets or flexi and all that sort of stuff.
Absolutely, And it's like you know, with We've got a huge percentage of New Zealanders that are coming off a fixed rate or they're still on a floating rate at the moment and looking to refix within the next twelve months. And you know, one of the things that you can think about is if you're coming off a higher rate and refixing at a lower rate, if you keep your mortgage payment the same, that smashes your mortgage much faster,
So you're not everyone can afford to do that. Some people have been struggling with the higher interest rates, so they can't wait to get on to a lower rate. But yeah, if you're comfortably paying a higher rate and you refix for a lower one, why not keep your mortgage payments up there.
I think the thing is a lot of how many people really do the numbers on this stuff?
I don't know. I don't know.
When you're talking to the people that you are often presenting them with ideas that go on or got and thought of that.
Yeah, just about every day when I talk to people about their financial position, I go, why haven't you done this? And they, oh, I wouldn't have thought about that. It's like, I mean, I guess you know, we're in the industry, so you know that this is the stuff that we live and breathe, and mortgage advisors, you know, they're in the industry, they live and breathe this stuff as well.
So yeah, it's certainly when you start looking at investing in property, you know, outside of the home, that's where I think it becomes even more important to have access to more than one bank.
It's a text here that's a bit concerning that I think we might need to have a quick look at it. Says I heard mention of a reverse mortgage. We took one out seventy dollars in twenty eighteen that sadly we didn't pay any back on a regular basis. Now we owe over two hundred and thirty thousand, and I mean to sell our house urgently. That doesn't sound like how a reverse mortgage works. Is I thought on reverse.
Mortgages they do capitalize the interest. So yeah, the banks do capitalize the interest. But yeah, I mean that sounds that sounds harsh.
But I thought that reverse mortgage was something where you took the money out and you didn't pay anything back.
That's usually how they are set.
So that doesn't sound like a normal reverse mortgage normally it's something you use for retirement. It's like, and if it ends up sucking up all the value of our house, then so be it.
Yeah, it'll never suck up all of the value of the house unless your house drops in value significantly, because the way that reverse mortgages work is that generally there'll be a limit as far as the percentage of the property value that they can lend up to.
Somebody says, here, by the way or the other thing, just pay the lump summits of wasteholding cash. You can always draw back down off your loan.
Well, if you'd still qualify Belinda, Well.
Yeah, it's not that straightforward. I mean, some might say, we had someone last week about it, just talking about how if you invested your money in the s and ps over the last five years, you'd made one hundred percent over five years. And somebody might say, don't pay off your all your mortgage. But that's a separate money discussion, I guess, isn't it.
Yeah, it depends on what you're looking at doing.
Not such a predictable gamble at the moment, though, was it right? We're going to be back with the one roof property of the weekend. Just a moment. It's eleven minutes to five.
If you're feeling down to swallow, make you happy, Babe around Artisalom make you happy.
Ab We've been doing all this leaner talking about anything you want till the morning.
Layer in my life. Yes, welcome back to the One Roof radio show. Fascinating talk. If you want to listen to any of this discussion around mortgages with Debbie Roberts from Property Apprentice, then do go and listen to the podcast. But I think the longest short of it is Debbie that you can probably you should get a mortgage advice if you've got any questions around the way to structure mortgage.
Yeah, I think so.
Yeah, they work for you, not for the bank exactly. I mean I thought you were talking to me personally. Then she means that generically to all you out there who are listening anyway, Hey, look right now it is seven minutes.
To five, the one roof Property of the week on the Weekend Collective.
Yes, the one roof Property of the week. As I said, it's always like taking a little holiday. Have you checked this one out? Debbie? Did we flick that one through to you? It is eight five to one b Takatu Road, tough for a newis Peninsula and Rodney. Three bedrooms, two bathrooms, no garage, garage garage. I dot even know how to say that it's not entry level? Is it two point three nine million expected? How would you describe the property when you looked at it?
Oh, I looked like it's the perfect place if you don't like neighbors.
What she'd said on the say, on the sting. It's a gorgeous property in terms of just the look. It's got a beautiful I'll always go for the outdoor flow and all that sort of things. Next to its own little lake, private land across from coveted Christian Bay. It's a coastal sanctuary, offering an it's not a lake, should I say, offers a tranquil retreat that perfectly blends architectural
design with the natural beauty of the surrounding landscape. I could read the whole blurb on it, which I won't do. In an outdoor bath outdoor bath that is selling point. Actually, I wonder if it's one of those things, an outdoor bath where it sounds scrape, But would you ever use the thing? Would you use an outdoor bath.
I mean not where we live at the moment. No, the neighbors would be shocked. And a place like that, there's literally no neighbors. You could you could walk around start naked the whole time.
Just about attention. Maybe they need to amend the blurb attention nudists and people who don't like neighbors maybe probably the same. But you should go and check it out. Really is a gorgeous area with great water views and fantastic outdoor living and if you want to have a little holiday and just get in fact, sometimes I think when you look at these open homes, you get some pretty good done You get some pretty good design ideas as well, don't you. There's a bit of lawnmowing involved.
Possibly get a ride on. But there's also a bunk room which features one, two, three, four, five, six, seven eight beds. So got a large family, got lots of friends, are going to come and visit check it out. Yeah, anyway, that is just again if you want that address, it is eight five to one b Tuckatu Road, tap at Anui Peninsula and Rodney and it is estimately a two point three nine million dollars, which I mean in the context of an Auckland price is probably not too bad,
is it. So what have you got coming up in the next little while with Properly Apprentice.
Well, Paul and I are off to a conference on Wednesday through Friday and then we roll into Easter.
So yeah, but busy holiday plans.
No, not at the moment that it was a bit of a disappointment. Response, Well, I think we need to work on that. If my husband's listening, let's plan one.
Hey, thanks, thanks so much. Nice to see you again, Debbie. We'll be back shortly with the Parents Squad. Jenny Hale as with us in the studio. We're talking about resilience and how do we grow resilient well, not just children, but resilient parents. We'll be talking about that shortly on the Parents Squad. This is News Talk, said b. It's three and a half to five. I don't nster and yess you don't.
Sometimes they're just kidding.
You haven't.
For more from the Weekend Collective, listen live to News Talks it'd be weekends from three pm, or follow the podcast on iHeartRadio.