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Brendon is away, enjoying a well-earned break with Linda walking the Camino de Santiago, and I was very much looking forward to taking over this blog and saying what needed to be said.
To my horror, I discovered that once again, I agree with what Brendon has been saying! Last month's statements hold true in every respect.
(You can see his April blog here.)
Wellington is not a city of joy at the moment. Our game of "Spot the Biggest Leak" (my personal favourite is at Kent Terrace and Elizabeth St) seems to confirm that all is not as it should be. Many of us are hurting. People are not going out as they used to, so hospitality and entertainment spending is down. This is not great if you own a bar or are a musician (shout out to The Love Shack party band). The stress in the public sector is real, and we do feel for our friends and family caught up in this part of the political cycle.
Inflation is proving to be persistent for the Reserve Bank. Anyone who has recently experienced Air New Zealand's increased fares for flights from Wellington to the Bay of Plenty can attest to the financial pain. The RBNZ continues to convey the message that rates will remain high until the end of the year to curb inflation.
So, what should you do? Please, as always, call us first. Having a conversation to explore all the financial options available to you is something we are always happy to do. Our recommendations are tailored to what your personal situation looks like over the next 6-18 months.
Some of you may have cash to allocate as a result of redundancy.
Please, please, please do not just deposit it into your mortgage without discussing it first.
We always recommend maintaining flexibility to cope with the 'what if,' even if that has just occurred. Paying down debt isn't always the best option. The adage 'cash flow is king' holds truer today than ever.
Interest rates are gradually trending downward. Each week, we observe banks taking turns to slightly reduce rates. We still believe that fixing for 6–12 months is a sound strategy. Opting for a longer period might lead to disappointment when rates begin to decrease more significantly
The housing market remains unpredictable. I recently spoke with one of Wellington's top agents at a sideline event, and he shared the challenges of pricing properties currently and the uncertainty of what will and won't sell.
If you are in the midst of buying or selling, it's crucial to seek knowledgeable advice.
Where is the good news, you ask?
Well, there are houses to buy. First home buyers should seize this opportunity now! There are plenty of options available, and now is the time to act.
Matariki is approaching, symbolizing a time of new beginnings and the transition to longer days. Looking forward to this!
This week has been a time of celebration for many with graduation ceremonies, which is exciting for those of us supporting our loved ones.
I don't mean to sound dismissive, but this challenging period will pass, and the sun will shine again… we'll just have to pay a little more to fly there.
Graham.
Graham Goodisson (FSP95428) is a Financial Adviser with Velocity Financial (FSP95466). No investment decision should be taken based on the information in this blog alone. Please see Graham’s disclosure statement on our website.
About Graham
Hi there, I’m Graham and I started Velocity Financial nearly 20 years ago. I had for many years been running youth development programmes for The Salvation Army and I liked the idea of continuing to help people thrive in other areas of their lives. It started with helping first home buyers, and I now work mostly with business owners. This is around planning, lending, and managing risk for them and their staff. I’m passionate about community and connecting those in need with opportunity. I’ve been very privileged to do this in my previous career, now in my business and also for 20 years as a Trustee of the Te Aro Health Clinic. Our clinic delivers high quality health care for Wellington's most vulnerable and I'm very proud of the fact that Te Aro is now an integral part of Wellington City Health system. I work in New Zealand's two best cities, Tauranga and Wellington. In Tauranga I swim, bike and run (maybe YOGA if I'm feeling particularly aware!) and in Wellington I mostly seem to buy my adult children dinner and drinks.
Always get professional advice
The information shared in this post is meant to be general guide to support you on your journey. When making important decisions about your finances, we encourage you to seek independent financial advice first, tailored to your unique situation. As well as talking with a financial adviser, make sure you talk to your lawyer and accountant too – together they'll help you find the best solution for your specific situation. Our knowledgeable financial advisers are here to help. Check out our website for the details about our financial advisory services in our disclosures https://www.velocityfinancial.co.nz/disclosure-statement.