Restructure your loan before it’s too late | New housing rules NZ 2021: No Interest Deductibility
The NZ Property Market and Mortgage Update PodcastShow Notes
New Zealand's government tackles at property speculators with a package of new housing rules to relieve runaway property prices and reduce the risk of a "dangerous" bubble. At the time of writing, it's still early to conclude how the new housing rules impact on the overall New Zealand property market, but definitely some investors could have already been spooked out of the market. Here is the recap of one of the new housing rules fazing investors: No interest deductions on residential investment property acquired after 27 March 2021. For the property acquired before 27 March 2021, the interests on the home loan will become progressively non-tax deductible against rental income from 1 October 2021. As a result, we anticipate that banks are more likely to review their servicing calculator and make it tougher for investors to borrow. This means if you are purchasing an investment property, or purchasing family home but you already have investment properties, your borrowing capacity may be reduced. However, we are still seeing that too many borrowers have multiple properties mortgaged to the same bank. Before banks tighten lending rules, we highly recommend reviewing your existing loan structure to avoid the risks that could have been eliminated. In this episode, we'll share one of the most common mistakes people make when borrowing for investment properties – holding multiple property loans with one bank – and discuss the potential risks. Also, at the end of the article, we'll reveal the cost of separating all property loans with different banks to help you weigh up the risks and benefits and make an informed decision. ------------------ Topics Covered: 1. Under the new housing rules, why should you consider splitting banks strategy? - 01:53 2. How to split property loans with different banks? - 05:21 3. What are the costs involved in splitting banks? - 06:35 ------------------ Subscribe To Our Podcast Make sure you've liked and subscribed to our channel where we upload new content every week! ------------------ Prosperity Finance – here to help If you would like to get more tailored advice, please feel free to get in touch. We are happy to review your situation and let you know how we can help. Call us at 09 930 8999 or email [email protected] for a chat with one of our mortgage advisors. As mortgage brokers based in New Zealand, we can help you to achieve your financial goals. No matter you are first home buyer, property investor, or looking for buying a commercial property, or if you are a construction builder or developer, we're here to help. ------------------ If that wasn't enough, you can also connect with us by... Website: https://prosperityfinance.co.nz/ Youtube: https://www.youtube.com/channel/UC9kryOMVOEZv8dmWGHz0ppA Linkedin: https://www.linkedin.com/in/conniewang-profinance/ Facebook: https://www.facebook.com/ProsperityFinanceNZ/ Instagram: https://www.instagram.com/prosperityfinance/?hl=en
More from The NZ Property Market and Mortgage Update Podcast
Last week, we shared some pros and cons of buying a commercial property because many people are now considering investing in commercial property. This week, we're going to continue with this topic and cover some of the areas that you need to consider if you are looking to purchase a commercial property to help you make a good purchase and also get your finance sorted smoothly. ------------------ Topics Covered: 1. What areas do you need to consider if you're looking to buy a commercial property? - 01:00 2. Other areas that can't be overlooked - 11:58 ------------------ Subscribe To Our Podcast Make sure you've liked and subscribed to our channel where we upload new content every week! ------------------ Prosperity Finance – here to help If you would like to get more tailored advice, please feel free to get in touch. We are happy to review your situation and let you know how we can help. Call us at 09 930 8999 or email [email protected] for a chat with one of our mortgage advisors. As mortgage brokers based in New Zealand, we can help you to achieve your financial goals. No matter you are a first home buyer, property investor, or looking for buying a commercial property, or if you are a construction builder or developer, we're here to help. ------------------ If that wasn't enough, you can also connect with us by... Website: https://prosperityfinance.co.nz/ Youtube: https://www.youtube.com/channel/UC9kryOMVOEZv8dmWGHz0ppA Linkedin: https://www.linkedin.com/in/conniewang-profinance/ Facebook: https://www.facebook.com/ProsperityFinanceNZ/ Instagram: https://www.instagram.com/prosperityfinance/?hl=en
Recently we have been asked by some clients that whether investing in commercial property is a good idea. The new policies announced by the government and banks are not in favour of residential property investors, such as the bright-line rule, interest deductibility rule, and the LVR rule. It tends to make the commercial sector more attractive because they are exempt from these rules, and also, the residential properties are getting much more expensive than before. So, if you have a limited budget, investing in commercial properties might be a good choice. ------------------ Topics Covered: 1. The benefits of commercial property 02:02 2. The downsides of commercial property 09:29 ------------------ Subscribe To Our Podcast Make sure you've liked and subscribed to our channel where we upload new content every week! ------------------ Prosperity Finance – here to help If you would like to get more tailored advice, please feel free to get in touch. We are happy to review your situation and let you know how we can help. Call us at 09 930 8999 or email [email protected] for a chat with one of our mortgage advisors. As mortgage brokers based in New Zealand, we can help you to achieve your financial goals. No matter you are a first home buyer, property investor, or looking for buying a commercial property, or if you are a construction builder or developer, we're here to help. ------------------ If that wasn't enough, you can also connect with us by... Website: https://prosperityfinance.co.nz/ Youtube: https://www.youtube.com/channel/UC9kryOMVOEZv8dmWGHz0ppA Linkedin: https://www.linkedin.com/in/conniewang-profinance/ Facebook: https://www.facebook.com/ProsperityFinanceNZ/ Instagram: https://www.instagram.com/prosperityfinance/?hl=en
Since the government introduced the interest deductibility rule early this year, we noticed some aspects of home loans that people need to be aware. If you don't do them correctly, you may end up paying more tax, or your accountant may have a headache when they prepare your financials at the end of the financial year. That’s why in this episode, we're going to cover three tips to help you work out how you can manage your home loan structure that best conform your situation and be tax efficient. ------------------ Topics Covered: Tips 1: Offset VS. Revolving account 01:02 Tip 2: Don't combine your loans, especially for the rental property loans 05:56 Tip 3: How to wisely use a lump sum money to repay loans – if you do not wish to use the money for something else to purchase a new property 06:56 ------------------ Subscribe To Our Podcast Make sure you've liked and subscribed to our channel where we upload new content every week! ------------------ Prosperity Finance – here to help If you would like to get more tailored advice, please feel free to get in touch. We are happy to review your situation and let you know how we can help. Call us at 09 930 8999 or email [email protected] for a chat with one of our mortgage advisors. As mortgage brokers based in New Zealand, we can help you to achieve your financial goals. No matter you are a first home buyer, property investor, or looking for buying a commercial property, or if you are a construction builder or developer, we're here to help. ------------------ If that wasn't enough, you can also connect with us by... Website: https://prosperityfinance.co.nz/ Youtube: https://www.youtube.com/channel/UC9kryOMVOEZv8dmWGHz0ppA Linkedin: https://www.linkedin.com/in/conniewang-profinance/ Facebook: https://www.facebook.com/ProsperityFinanceNZ/ Instagram: https://www.instagram.com/prosperityfinance/?hl=en
Unexpected announcements of interest rates lifting by over 30 base points from all mainstream banks surprised many of us last week. Whereas interest rates were predicted to remain low for years to come, now turning on a dime and start rising. The one-year fixed term rates have lifted from 2.19% to 2.5%. In this video, we'll go into depth on the reason for the interest rates increasing and reveal the tactics on how you can deal with it to minimise the impact. ------------------ Topics Covered: Video timeline 1. Why the interest rates increase? 01:48 2. What can we do? 05:35 ------------------ Subscribe To Our Podcast Make sure you've liked and subscribed to our channel where we upload new content every week! ------------------ Prosperity Finance – here to help If you would like to get more tailored advice, please feel free to get in touch. We are happy to review your situation and let you know how we can help. Call us at 09 930 8999 or email [email protected] for a chat with one of our mortgage advisors. As mortgage brokers based in New Zealand, we can help you to achieve your financial goals. No matter you are a first home buyer, property investor, or looking for buying a commercial property, or if you are a construction builder or developer, we're here to help. ------------------ If that wasn't enough, you can also connect with us by... Website: https://prosperityfinance.co.nz/ Youtube: https://www.youtube.com/channel/UC9kryOMVOEZv8dmWGHz0ppA Linkedin: https://www.linkedin.com/in/conniewang-profinance/ Facebook: https://www.facebook.com/ProsperityFinanceNZ/ Instagram: https://www.instagram.com/prosperityfinance/?hl=en
The debt-to-income ratios are likely to be the most effective measurement that can be deployed by the RBNZ to support the stability of banking system. However, the restrictions will affect property investors, particularly those who are looking to grow their portfolios. In this episode, we’re going to have a deep dive at the debt-to-income ratio – who will be impacted, to what extent will it affect you (illustrating by a case study), and what strategies available to you, so you can start reviewing and considering how you can minimize the impact. ------------------ Topics Covered: 1. Who will be impacted by the implementation of the debt-to-income ratio? 04:37 2. Case study: to what extent will the DTI affect investors? 06:10 3. What are the strategies available right now? 12:59 ------------------ Subscribe To Our Podcast Make sure you've liked and subscribed to our channel where we upload new content every week! ------------------ Prosperity Finance – here to help If you would like to get more tailored advice, please feel free to get in touch. We are happy to review your situation and let you know how we can help. Call us at 09 930 8999 or email [email protected] for a chat with one of our mortgage advisors. As mortgage brokers based in New Zealand, we can help you to achieve your financial goals. No matter you are a first home buyer, property investor, or looking for buying a commercial property, or if you are a construction builder or developer, we're here to help. ------------------ If that wasn't enough, you can also connect with us by... Website: https://prosperityfinance.co.nz/ Youtube: https://www.youtube.com/channel/UC9kryOMVOEZv8dmWGHz0ppA Linkedin: https://www.linkedin.com/in/conniewang-profinance/ Facebook: https://www.facebook.com/ProsperityFinanceNZ/ Instagram: https://www.instagram.com/prosperityfinance/?hl=en