« January 2011 | Main | March 2011 »

Gareth Morgan on House Prices

I like this piece on house prices from Gareth Morgan - be warned, he's bearish on them - but it's good. Link.

I have some friends in real estate who point out, quite sensibly, that indices are all right, but what happens to the value of an individual, specific house, is quite another thing. Also wise words, if you actually need to sell one. As for agents being too expensive, I believe the same accusation has been levelled at fund managers...


Ask a stupid question...

...and you'll get a stupid answer. In the UK they have been pondering whether borrowers might profit from compulsory advice. Hmmmm. Not a fan of compulsion in anything I am naturally suspicious. However, I had to laugh when the headline in Money Marketing ran "some borrowers would benefit from compulsory advice". Gee, I would hope so.

Talk about being damned by faint praise.

Perhaps we could run a series of alternatives: "Mortgage advice not wholly wasted". Perhaps we could see alternatives in other walks of life - compulsory weightwatchers classes, because "some people would benefit from compulsory weight management advice" or maybe we can get like those companies that always do calisthenics in the morning before the shift starts because, well, you get the picture.

Really, home loan advice is not that complicated. The level of the payment has to be affordable, the risk that the payment may rise has to be understood, the fundamental sanction that the home is at stake and eviction is the end result of non-payment needs to be crystal clear. If this needs to be covered by compulsory advice there is no reason it cannot come from the lender, or be required of the legal adviser when handling the mortgage documentation. 

 


Securities Commission Presentation

Information from the Securities Commission Presentation in Balclutha, courtesy of Alan Rafe.
Summary

Why Does it take 3 months for AFA approval?

  1. Need to complete an additional criminal check (in addition to the Registration check for RFA) looking for any offence that could be punishable by at least six months in prison. If anyone has something they should indicate this beforehand otherwise it will create delays.
  2. Check of referees
  3. Have to check with universities to confirm qualifications.

To be fair to the Securities Commission, no-one expects to hold them responsible if a University will not provide confirmation. In effect, if three months is a fair guideline because of the dismal performance expected from third parties, then we can all live with that. However, what they should be doing is saying "if we get the requirements back from othird parties, our part of the work will only take X days" The value for X in this case, should be a single digit number.

Additional Issues

  1. Reinforced the need for all AFAs to lodge their application forms by 31 March.
  2. There will be no extensions given from the 1 July deadline (Christchurch advisers effected by the quake will be given individual consideration)
  3. If you have summited your application late and have not received your AFA approval by 1 June you will not be able to give financial advice (...and they will be checking)
  4. You do not need to wait for all the requirements to be met before lodging your application with the commission. They will start working on them if they are incomplete and you will also reserve yourself a place in the queue.
  5. If you are an AFA under QFE you do not need to wait for the QFE registration number before submitting your application, this can be added later just add a note that you are waiting for it.
  6. Some enhancements have been made to the web site to lodge applications.

I particularly like the comments under 4 and 5 - it's good to see that partial applications can be lodged.

 


Insurance Staff Lost in Christchurch Earthquake

Insurance News.com.au quotes Chris Ryan of the Insurance Council in this item:

'The CEO of one major loss adjusting company told insuranceNEWS.com.au this morning that “some” of his firm’s employees are still listed as missing, and another loss adjusting company has confirmed that one of its employees has been killed.'

Link.


QFE applicants list and review

The companies office has a helpful (public) register of Financial Service Providers. You can't search by QFE applicant status, but it is listed. I condemned my long suffering Administrator, the wonderful Kelly Pulham, to identifying them. The list is shown at the end of this post for your reading pleasure. 

We believe that there are more FSPs that are interested in QFE status, perhaps another 30 engaged with Securities Commission in discussions, and perhaps another 30 in the market that are quite serious about the step, but aren't yet even having conversations with officials.

There is a great diversity in the organisations applying. They cover the value chain - from product providers to distributors - and a wide range of formats of each of those companies are included too. They also appear to range from the small to the very large.

Here is a summary:

  • 7 Life Insurers
  • 3 Banks
  • 6 General Insurers
  • 5 Credit Unions
  • 3 Health Insurers
  • ...plus lots of finance companies and financial advisers.

Registered Financial Services Providers 7 Dec 2010 – Entities, not individuals, applying for QFE Status

ACE INSURANCE LIMITED (FSP35924)
ACM INSURANCES LIMITED (FSP34663)
ALLIANZ NEW ZEALAND LIMITED (FSP35041)
AMERICAN INTERNATIONAL ASSURANCE COMPANY (BERMUDA) LIMITED (FSP39383)
AMP SERVICES (NZ) LIMITED (FSP38082)
ANSVAR INSURANCE LIMITED (FSP15441)
ANTHONY RUNACRES AND ASSOCIATES LIMITED (FSP38761)
Anz National Bank Limited (FSP36405)
AOTEAROA CREDIT UNION (FSP36561)
ASSET FINANCE LIMITED (FSP3501)
ASTERON LIFE LIMITED (FSP25081)
AVANTI FINANCE LIMITED (FSP41821)
CIGNA LIFE INSURANCE NEW ZEALAND LIMITED (FSP27625)
CREDIT UNION BAYWIDE (FSP27482)
CREDIT UNION NORTH (FSP18821)
CREDIT UNION SOUTH (FSP27046)
DORCHESTER LIFE LIMITED (FSP38802)
ERIKSEN & ASSOCIATES LIMITED (FSP40147)
FINANCE NOW LIMITED (FSP42822)
FIRST CREDIT UNION (FSP29785)
FISHER & PAYKEL FINANCE LIMITED (FSP21661)
FISHER FUNDS MANAGEMENT LIMITED (FSP38581)
FORSYTH BARR LIMITED (FSP24848)
GE FINANCE AND INSURANCE (FSP11701)
GOLDEN STAR INVESTMENT LIMITED (FSP28601)
HULJICH WEALTH MANAGEMENT (NEW ZEALAND) LIMITED (FSP40142)
INSTANT FINANCE NZ LIMITED (FSP20381)
JARDINE LLOYD THOMPSON LIMITED (FSP34047)
JOHN DEERE CREDIT LIMITED (FSP3121)
KIWIBANK LIMITED (FSP19941)
LEASEPLAN NEW ZEALAND LIMITED (FSP42402)
MEDICAL ASSURANCE SOCIETY NEW ZEALAND LIMITED (FSP35849)
MERCER (N.Z.) LIMITED (FSP42742)
MOTOR TRADE FINANCES LIMITED (FSP26831)
NELSON BUILDING SOCIETY (FSP33381)
OXFORD FINANCE CORPORATION LIMITED (FSP46926)
PGG WRIGHTSON FINANCE LIMITED (FSP38184)
PROMETHEUS FINANCE LIMITED (FSP34501)
PSIS LIMITED (FSP17605)
SENTINEL LIMITED (FSP48342)
SMITHCORP FINANCE LIMITED (FSP25143)
SOUTHERN CROSS BENEFITS LIMITED (FSP42852)
SOUTHLAND BUILDING SOCIETY (FSP30921)
SPICERS PORTFOLIO MANAGEMENT LIMITED (FSP26061)
STEELSANDS CREDIT UNION (FSP37128)
TAUPO MOANA FUNDS LIMITED (FSP7581)
THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED (FSP36886)
THE NEW ZEALAND GUARDIAN TRUST COMPANY LIMITED (FSP33501)
THORN RENTALS NZ LIMITED (FSP39861)
TOWER HEALTH & LIFE LIMITED (FSP41485)
TOWER INSURANCE LIMITED (FSP41165)
TOWER MANAGED FUNDS LIMITED (FSP41483)
WESTFORCE CREDIT UNION (FSP35932)
WESTPAC NEW ZEALAND LIMITED (FSP35681)