19/02/2024
Aseem Agarwal, a partner at mortgage advisory firm Global Finance, said despite changed lending conditions and high interest rates, local buyers were still finding ways to service $1m and $2m loans. “Buyers find ways to stretch themselves to get over the line,” he said.
Whether the loan size was $500,000 or $2m, banks would still check a borrower’s ability to pay, and go through household income, expenses, and the stability of incomes, line by line. “If they have no alarm bells, then they are pretty okay to approve the loan,” he said.
Agarwal said he had recently arranged a $2m mortgage for a couple with a combined income of $450,000. One is still working overseas and one is working locally in New Zealand.
But due to financial pressures, some borrowers needed side hustles to meet their financial commitments. Agarwal cited a couple who are building a home on a section they own. They had to make payments on the section loan and a separate construction loan as well as pay rent.
“They are both in good managerial positions with well known companies, and have $260,000 combined income. But to be able to afford to pay the rent and the mortgages on the section and build, they both have to do a side hustle. Both are doing Uber Eats [in their spare time].”
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Stressed homeowners shelling out at least $6000 a fortnight in mortgage repayments.
