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New aggressive mortgage pricing from Westpac signals a clear goal to win market share off rivals; big reductions require existing clients to borrow more
Westpac has started the week with some new aggressive home loan pricing.
It has released new fixed-rate mortgage specials after ending its 2 year 4.99% rate.
It's new 1 year fixed rate special is 4.89%.
It's new three year fixed rate special is now 5.39%.
It has kept its 4 year special at 5.99%
And it has reduced its five year fixed rate special to 5.75% from 5.99%. That 5.99% rate now becomes it's standard five year rate.
These specials come with conditions: there must be a minimum of 20% equity and importantly, there must be at least $100,000 of new lending.
That means customers of other banks who move their mortgage to Westpac and who have a mortgage of $100,000 or more will qualify.
Related Topics
But existing customers of Westpac will need to increase their loan with the bank by at least $100,000 to qualify.
These changes come after its management noted that it was not doing as well as they wanted in the New Zealand mortgage market.
Westpac's new one year special rate of 4.89% is easily the best one year rate in the market at this time for banks.
| One year fixed rate mortgages | % |
| ANZ | 5.25 |
| ASB | 5.45 |
| BNZ | 5.25 |
| Co-operative Bank | 5.25 |
| HSBC Premier | 5.25 |
| Kiwibank | 5.25 |
| SBS / HBS | 5.25 |
| TSB* | 5.25 |
| Westpac | 4.89 |
Note that TSB has a 15 month Special of 4.95%
Westpac's new three year special rate is also a clear market leader among banks.
| Three year fixed rate mortgages | % |
| ANZ | 5.90 |
| ASB | 5.75 |
| BNZ | 5.90 |
| Co-operative Bank | 5.75 |
| HSBC Premier | 5.74 |
| Kiwibank | 5.65 |
| SBS / HBS | 5.65 |
| TSB | 5.95 |
| Westpac | 5.39 |
Westpac's five year special trumps all other banks as well.
| Five year fixed rate mortgages | % |
| ANZ | 6.60 |
| ASB | 6.25 |
| BNZ | 6.50 |
| Co-operative Bank | n.a. |
| HSBC Premier | 6.65 |
| Kiwibank | 5.99 |
| SBS / HBS | 5.99 |
| TSB | 6.50 |
| Westpac | 5.75 |
Westpac's special rates at these new low levels will undoubtedly get the attention of its rivals, who may well respond directly with rate cuts of their own, or informally by offering more competitive deals on a one-on-one basis as clients negotiate.
You can find up-to-date mortgage rates for all institutions on our comprehensive mortgage rate page here »
The best way to make sense of any mortgage rate offer is to run it through our comprehensive calculator, which allows you to compare rates between banks. You can find that calculator tool here »
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Mortgage choices involve making a significant financial decision so it often pays to get professional advice. A Roost mortgage broker can be contacted by following this link »
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12 Comments
Red flag Wheeler....wake up!
Red flag Wheeler....wake up!
You can ignore all of the
You can ignore all of the rates in the article above - all banks will negotiate and discount further than these published rates. But why would you fix your mortgage when rates will only decline further over the next 6 months?
The OCR is likely to be cut so don't be fooled by the banks - they know rates are heading down!
In the UK 5 years fixed is available at 3.39%
Big Blue - truth is bank
Big Blue - truth is bank funding spreads that they're having to pay are falling as the world gets more comfortable that there will be no financial crisis in the short-medium term because central banks print money that they use to prop up the system. The other side of that is that base rates (i.e. swap rates) will and are rising negating some of that benefit, however at the moment the fall in funding spreads is the bigger mover, but that will change over this year. So its a sweet spot for banks to be able to temporarily lower rates before rises later in the year. This is a particular opportunity for Westpac, who's mortgage market share has fallen in recent time, to be aggressive, but it is not a long-term change
Xingmowang's rates below will not occur without a financial collapse, and whilst I don't rule that out in the medium to long-term, can't see it happening in the next year or two unless the central banks suddenly discover the error of their ways and stop fianncing Govt deficits with money printing - fat chance of that in the next 12 months
My forecast over the mortgate
My forecast over the mortgate rate is
4.5 - 4.9% float at end of this year
4.35 - 4.5 % fixed in various terms
I seem to remember everyone
I seem to remember everyone saying that at the start of last year and it didn't happen...
JJ just because people say
JJ just because people say something is going to happen, and it hasn't happened yet, doesn't mean it isn't going to happen.
In the immortal words of Rachel Hunter - "it won't happen overnight, but it will happen".
I'm punting on getting a better deal than my current 4.99% floating come June 30. I'm confident it will happen.
"....existing customers of
"....existing customers of Westpac will need to increase their loan with the bank by at least $100,000 to qualify....." Well that will lead to tears somewhere.
Effectively making their
Effectively making their existing customers change bank to get these rates (as the other banks will match). Same with the cash handouts and other bribes - they only give them to new customers, and existing customers have to change banks to get them.
In saying that, I managed to get $1000 cash from ASB by increasing my revoloving mortgage by $100k even though I will never use it, must have been a back door in their system...
Sounds like a good plan
Sounds like a good plan Jimbo. Take out an extra 100k put it on floating and repay the whole thing the following day. guess you pay an admin fee for a new facility?
I didn't pay any fees. I
I didn't pay any fees. I just walked into a branch to deposit some money and the lady at the branch offered it to me, no gotchas apart from the temptation to use the $100k. I do pay $12/month fee for the revolving mortgage, that didn't change.
That sucks, I am completely
That sucks, I am completely getting the run around form ASB, they won't match Westpac's rates, 4.99 (now finished I see) or the new one year special, most they will do is 5.10 which is good considering their carded rate I guess, and I am supposed to be a high valued customer.
and there will be many
and there will be many Westpac Customers like myself who will be actively looking at movements from other banks but floating still rulz in my book