sign up log in
Want to go ad-free? Find out how, here.

NZ's biggest mortgage lender chops its 2yr rate just hours after two rivals matched it; now joins most others with a sub 6% offer

NZ's biggest mortgage lender chops its 2yr rate just hours after two rivals matched it; now joins most others with a sub 6% offer

Emphasising just how competitive the home loan market is, ANZ has announced a further reduction in its 2 year fixed mortgage rate.

This change comes just hours after both BNZ and SBS Bank lowered their two year rates to match ANZ at 6.09%.

But ANZ has now cut that rate to 5.99%.

It is the latest bank to take its two year home loan rate below 6%.

The ANZ 5.99% rate now matches both ASB and Kiwibank at that level.

It also matches TSB Bank, and these four banks are only bested by HSBC which offers a 5.85% rate for its Premier customers.

The ANZ offer is effective tomorrow, Wednesday, August 6, 2014.

It is also a 'special'. That means it is only available to customers of ANZ with 20% equity in their house, an ANZ transactional account with salary direct credited, and any ANZ credit card or ANZ insurance product. The rate is not available with any package discounts.

The new ANZ 5.99% rate has been lowered 10 basis points from 6.09%. That previous 6.09% rate was itself a reduction from 6.45%. But you only have to go back to May 19 to find that ANZ was offering the 5.99% rate for two years as well. So in only ten weeks the 'rising rate' story has been completely unwound.

Mortgage rates in the one to three year range are generally soft at present, and we have seen renewed rate competition in this zone since the last Reserve Bank Official Cash Rate hike late last month.

With a pause signalled by the central bank on more hikes until after the election and falling international bond yields, the New Zealand swap markets have been reflecting these shifts and the cost of funds allows banks to offer sharper rates.

With the home loan market being in relatively low-growth mode, banks are increasingly competitive. Non-rate inducements are also growing in importance, especially cash incentives.

Banks bundle these incentives when they negotiate so borrowers will need to be careful and clear of their objectives in these discussions. Use a mortgage calculator that displays the full cost of your loan when you are making these assessments.

See all banks' carded, or advertised, home loan rates here.

This is how the updated mortgage rates compare as at 7:00 am Wednesday, August 6, 2014:

below 80% LVR 1 yr 18 mths 2 yrs 3 yrs 5 yrs
           
6.05% 6.25% 5.99% 6.65% 7.15%
ASB 6.09% 6.30% 5.99% 6.65% 6.99%
5.99% 6.25% 6.09% 6.25% 6.99%
Kiwibank 5.99%   5.99% 6.65% 6.95%
Westpac 5.95% 6.30% 6.09% 6.65% 6.99%
           
Co-op Bank 6.00% 6.00% 6.00% 6.25% 6.89%
HSBC 5.85%   5.85% 5.85% 6.99%
5.85% 5.99% 6.09% 5.95% 6.79%
6.00% 6.05% 5.99% 6.60% 7.00%

--------------------------------------------------------------

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 »
--------------------------------------------------------------

Fixed mortgage rates

Select chart tabs

unweighted
unweighted
unweighted
unweighted
unweighted
unweighted

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

1 Comments

The banks are finding that potential borrowers are finding the price of money is too high. 

Borrowing growth is still slowing. 

Solution: reduce interest rates.  

Up
0