Notwithstanding it was an election year, our loan book grew steadily in 2023. And with 2024 now well underway and a new government settled in, we expect to see further growth in the amount of loans we will have in 2024.
We anticipate bringing a diverse array of investment opportunities that will appeal to all investors, regardless of appetite or location.
Auckland, Wellington and Christchurch have always been a strong source of loans both in quality and quantity. Given the excellent track record and the improving property market in those locations, we are increasing our loan-to-value ratio (LVR) ceiling for loans in these three main centres to a maximum of 75%.
There are strict criteria for these higher LVR loans. Only quality residential properties (no construction of any kind or bare land) in prime locations; a maximum loan amount of $1,750,000; solid exit strategies; and borrowers with exceptionally strong track records, will be considered.
Last year we invested in the Canterbury and Otago regions with the appointment of a lending BDM, Simon Maule, and we are now seeing consistently excellent investments coming through in these locations.
We recognise that other regions are also experiencing steady growth to be a potential source of quality short-term investments however, these will be at much lower LVRs.
Investors will also start seeing more commercial property investments come through the portal. Quality buildings in good locations are the key with standalone, purpose-built properties preferred over units with body corporates or that are part of a larger complex.
Future saleability plays an important part in all our lending approvals regardless of whether they are residential or commercial, however, with commercial it is a higher consideration in the overall credit decision.
The overall quality of the loans we bring you remains of paramount importance to us, and this is reflected in our extremely low arrears rates, currently sitting at 0.72% of our total loan book. You can view our arrears rates here. It’s a track record we are proud to maintain.
Most crucially, our investors can expect the same quality loans we have always prided ourselves on. We continue to be a major choice of funding provider for top mortgage advisors who know that SCP will look after their customers lending needs.
Investors tell us they like the flexibility we offer, and this is apparent with several current investors selling their investments, via the secondary market process, to be able to purchase lifestyle units before their family home sells. You can read about this more in our previous blog here. If you think you may also be in this position, please get in touch with one of the team to help you manage your portfolio.
There are many investment choices available, and we are grateful of the support our investors show us, which is reflected in the number of referrals we received.
If you would like others to know about us, please feel free to get in touch with a member of the investment team or email us at investments@scpartners.co.nz.