100pc mortgage helps couple realise dream

Cindy and Rashaad Vahed would have left New Zealand if they had failed to buy their own home.

The 26-year-old professionals were struggling to scrape a deposit together, and their homeowning dream looked bleak.

They even contemplated returning to South Africa.

That was until late July, when they succeeded in getting a 100 per cent home loan of $305,000 to buy a terraced townhouse in Albany.

But Mrs Vahed said it was initially a struggle convincing the banks that they could service the debt.

The credit control officer and her husband are now paying $2700 a month on their mortgage - three times more than they would have paid in rent - but say their first step into home ownership has been well worth it.

It would have been very difficult for them to scrape together a deposit while paying rent, said Mrs Vahed - and she knows of other couples in a similar situation.

She has even referred one friend to her mortgage broker.

The first month of mortgage repayments proved difficult since they got married then as well, but they are now coping "comfortably" with repayments.

Mrs Vahed said putting a limit on loan-to-value ratios for mortgages would shut the door on a lot of first-time buyers.


Options being considered to cool housing market:


* Limiting the amount banks can lend on a property's value.


* Axing or restricting tax vehicles such as Loss Attributing Qualifying Companies which allow personal tax reductions through property investment.


* Altering Reserve Bank rules that supervise banks to smooth the housing credit cycle.


* Other interventions to influence the amount and/or price of mortgage lending.