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EMail Newsletter
December 2006
 More
than 41% of recent or intending homebuyers say they would go to a
Mortgage Broker to arrange a home loan, according to the latest MIAA/Bank
West home finance survey.
This is the first time the survey has indicated that more homebuyers
prefer arranging their home loan through a broker rather than going to a
bank, with 37.2% saying they would go straight to a bank.
This makes for a very interesting shift in the market over coming years.
In the past borrowers would go to a broker to find out which bank has
the best loan or interest rate. We now have non-bank lenders offering
better rates than the banks. Over the coming years I can see the market
following the lead from the USA with around 90% of loans going through
non-bank lenders via brokers, and the banks not really figuring in the
home loan market.
And for those of you who worked out that 41% and 37.2%
doesn’t add up to 100%…the balance was made up of non-bank specialist
home loan suppliers, credit unions and building societies.
Fixed Rate Loans
 Those
of you who have been hit hard by this years' rate rises may want to
consider fixing your loan for three or five years. The best 5-year
fixed rate we have available is currently 6.99% (with a comparison rate
of 7.62%).
Follow this link for information on
Comparison Rates. Don’t read too
much into the comparison rate for fixed rates. It assumes that the loan
will revert to a Standard Variable after the fixed period. We would
usually switch you to a Professional Package after the fixed rate, which
would reduce your ongoing interest rate.
The best variable rate offered by the major banks is 7.37% and we have
rates slightly lower than this from non-bank lenders, which makes the
five-year fixed look very attractive.
How
Good Do You Feel?
The
Sydney Morning Herald this week reported on a study by Professor Bob
Cummins, from Deakin University, who revealed lower levels of wellbeing
among renters compared with mortgage holders.
He said renters were more likely to be single and lead a more mobile
lifestyle. Personally I would like to put forward the theory that single
people are more likely to be renters due to a mortgage being more
affordably when there are two incomes in the family (though if it were
that easy we’d all be professors).
In another amazing piece of research the professor also deduced that
higher income levels also bolstered wellbeing.
Don’t you feel sorry for all those people who don’t have a mortgage to
make them feel this good?
Out of interest, the study was commissioned and paid for by Australian
Unity, which no doubt improved the professors’ wellbeing considerably.
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