In light of the ongoing Covid-19 pandemic, Norfolk Mortgage Trust extends its well wishes to you and your families, hoping for your safety and well-being during these challenging times. We remain committed to providing assistance and addressing any concerns you may have regarding investments, borrowing, or the performance of the fund. As an essential service, Norfolk Mortgage Trust assures you that we have the necessary resources and structures in place to continue operating effectively.
Norfolk’s Resilient Investment Approach
Unlike many others affected by Covid-19, Norfolk Mortgage Trust does not invest in the share market, either internationally or nationally. Our sole focus is on investing in New Zealand, specifically in loans secured by registered first mortgages. This strategic approach allows us to maintain stability and mitigate potential risks associated with market volatility.
Solid Position to Weather the Impact
As of the end of February 2020, Norfolk had a loan-to-value ratio of 40.67%. The directors firmly believe that we are well-positioned to weather the impact of Covid-19 and the market slowdown. We are actively reviewing our portfolio and closely monitoring all developments to ensure we are fully prepared for any contingencies that may arise. Rest assured, we will provide timely updates should there be any changes to our investment returns.
Increasing Demand for Loans and Investments
In response to banks and non-bank lenders tightening credit criteria, we have observed a growing demand for loans. Moreover, our higher-than-bank term deposit rates have also led to an increase in investment interest. In fact, our last monthly interest distribution reached 6.0% before tax, further demonstrating the strength of our investment opportunities.
Uncertainty in the Long-Term Property Market
The impact of Covid-19 on the long-term property market remains uncertain. However, it is important to note that there is a strong underlying demand for property in New Zealand. Various sources and commentaries suggest that the market will not experience a prolonged downturn. The Government has shown its commitment to supporting the economy, ensuring a robust recovery following the lockdown period. To stay informed about the property market, we recommend visiting the following resources:
- Financial Markets Authority: https://www.fma.govt.nz/news-and-resources/
- Real Estate Institute of New Zealand: https://www.blog.reinz.co.nz/
- Reserve Bank of New Zealand: https://www.rbnz.govt.nz/
Summary
As we navigate through these uncertain times, Norfolk Mortgage Trust remains dedicated to serving our investors. With our resilient investment approach and commitment to monitoring market developments, we are well-prepared to manage the impact of Covid-19. We encourage all our investors to prioritise their safety, practice self-isolation, and take necessary precautions. We are here to support you every step of the way.