SMART BORROWING: It makes the most financial sense to use your existing home loan to access the money you need for things such as renovations or a new car, as unsecured personal loans can have much higher interest rates.
Home renovations can be a daunting proposition, but accessing money for improvements around your property is usually a far less stressful task.
Vince Clark, head of home lending and deposits at ASB, says there are a variety of different ways homeowners can obtain funds for their renovation plans, with personal loans and home loan top-ups just some of the options available.
Because higher interest rates usually apply to unsecured forms of borrowing such as personal loans, Clark says it makes the most financial sense to use your existing home loan to access the money you need.
With an annual growth-rate of 6.2%, the outlook is looking bright for Canterbury as the rebuild progresses.
The ASB Cantometer, an indicator designed to capture the pick-up in Canterbury activity as the earthquake rebuild progresses, remained steady at 1 (zero indicates the level of activity prior to the earthquakes) for the fourth consecutive month in November. Encouragingly, recent data showed a strong rebound in building consents after a flat patch. Other data have been more mixed. Here are some snippets from ASB’s report:
Over recent months we have focused a lot on building consent issuance, which appeared to have plateaued. We were concerned whether the cause was merely a temporary blip or emerging bottlenecks. Encouragingly, the data for September showed a strong rebound in consent issuance. In fact Stats NZ reported that the 599 new dwellings consented in the month was the highest recorded monthly total for the region.
For now, it remains too early to judge the impact of the RBNZ’s new ‘speed limits’ on high-LVR mortgage lending. The RBNZ will closely monitor any impacts on construction. In a sign that some of the pressure within the Canterbury housing market may be easing, there has been a lift in fresh home listings over the last couple of months.
The outlook for Canterbury remains very bright. Data suggested that growth in construction may have leveled off around the middle of the year, but more recent evidence suggests that activity may be starting to accelerate once again. There are also tentative signs that supply constraints in the housing market may be starting to ease.
I’m quietly optimistic about what 2014 has in store for Christchurch. While it mightn’t be entirely smooth sailing, the sheer amount of money and resources being poured into the garden city will ensure it remains to be a major economic powerhouse for some time to come.
I received this info from my ASB private banker Jill Rogers that I thought may be of interest…
You will have seen lots of information on the changes from “Full Replacement Cover” to “Sum Insured Replacement” on New Zealand homes.
To help you through the change to “sum insured replacement” visit www.need2know.org.nz.
If you have an ASB House Insurance Policy [or any IAG House Insurance Policy], you will receive information on the changes as your policy comes up for its annual renewal.
Your renewal notice may have a “sum insured” figure provided. You will need to check this and ensure you are happy with that figure.
The above website has “Calculators” that can assist you with a sum insured figure for your home.
Alternatively – Valuers can provide a “Valuation for insurance purposes” – cost of this will depend on the size of your home.
Moving forward, once a Sum Insured value in place, you will need to continue to check it annually on your renewal date to ensure the Sum Insured figure accurately reflects the replacement value of your home allowing for any upgrades or alterations you may have made to your home.
If your home insurance policy is moving to “sum insured”, it’s imperative that you get it right – you don’t want to be caught short in the event of a total loss, nor do you want to be stuck paying higher premiums than you have to.