Banks systems have been fine-tuned for the RBNZ LVR restrictions and buyers needing to borrow more than 80 percent of the value of the property are slowly coming back to the market.
NZHerald reports April 14 has seen a rise in the percentage of loans granted though it is still a way off the allowed limit of ten percent of total new loans for a Bank.
The April figure of 4.3 percent was higher than the 3.6 percent reported for March but clearly no where near the 10 percent ceiling so this offers more room for the Banks.
With a couple of interest rises since the introduction of the LVR restrictions and the slow down in property sales the RBNZ have indicated they may drop the LVR restrictions as early as the end of the year.
A group of people who are not miffed by the restrictions are property investors and in particular those on the PropertyTutors mentoring program.
PropertyTutors held their The Masters events last month and both Auckland and Wellington were jam-packed with people interested in property investment and in particular the strategy taught by PropertyTutors mentors – ‘buy to renovate and hold or sell’.
Renovating to sell is also called trading and the turnaround from initial purchase to resell can be as little as four weeks. This strategy allows for the use of non mainstream lenders and in some cases more creative lending options due to the short time the loan is required.
The success of Sean Wood’s and Steve Goodey’s mentoring clients is not over the heads of most people and trading may be utilised to build up a healthy deposit for a PPOR (principal place of residence).
While this may be the goal at the outset for some of their clients often they just keep going and resign onto the mentoring program such is the success of the property investment strategy irrespective of loan restrictions.