No legislation can fix this. There are only so many builders and then there are some many people. Apparently 1200 people on the waiting register in Hawkes bay to find a home
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https://www.stuff.co.nz/business/pro...erse-mortgages
Some nice free advertising, courtesy of Stuff :t_up:
Another strong GDT auction overnight Winner. Must be good for HGH eh?
https://www.nzherald.co.nz/business/...CL2DJOYP47A3E/
Dairy prices reach highest level since 2014 !! That's got to be good for $2.14 again surely ;)
Is the market waiting to see what happens on Monday?
Has anyone got concerns with the 'Heartland Extend' product hiding accounts that should be in arrears and years gone by a provision would be slapped on it? Thus the product is kicking the can down the road.
I.e. say you fund a $750k long haul curtain sider truck and trailer unit that has a useful life of 5-7 years before the repairs and maintenance really start to kick in. The truck is paying its way earning you a nice salary while you are driving 5 days a week doing loops of the golden triangle. Halfway through the loan COVID hits and work dries up, your now working 3 days a week and use Heartland extend to put the loan over 10 years- far outside the useful life of the truck. Truck now has say 3 years left of work in it before you are hit with big engine bills. Loan term remaining is 5,6,7,8... years. You are completely upside down with the debt over the truck far more than the value of the truck. Sooner or later the issue is going to have to be addressed.
When results are announced I will be most interested in seeing the loan value in the Heartland extend product. As a big portion of this would be provisioned loans in days gone by I suspect.
Disc. Still hold. A much reduced stake. Sold majority last month.
Hopefully you are wrong, bought a lot of these in April. Feeling positive going into next week
Rising interest rate environment is great for banks. They're able to utilize cheap money from term deposits https://www.heartland.co.nz/savings-...interest-rates to fund loans at higher floating and fixed rates.
I'm expecting a very good result on Monday next week.
Yes very good result indeed if we can go by forecast from last meeting (and some) with ever increasing demand from reverse mortgages.
FWIW Raz I think your concerns are valid. It is conceivable that Jeff has persuaded some of these types of loans to transfer to the IRD zero interest loan scheme (zero interest for a time anyway). But in general I do not expect business loans, including O4B, to be a happy hunting ground for Heartland this year. However the Heartland loan book is a team of multiple players. I also share the view of others that reverse mortgages should do well. For the Heartland loan book overall, you have to ask the question will the stronger team player be able to compensate for the weaker one. I think they will. But we will all know the answer soon enough.
SNOOPY