ASB is again leading the home loan interest rate market higher with across the board increases ranging from 16 basis points to 30 basis points.
The result is that ASB now has only one rate, their one year offer, under 4%.
And for fixed terms from six months to three years, ASB has the highest carded rates in the market. (ANZ's four and five year fixed rates are higher.)
In a hot and rising market, it appears ASB doesn't see any downside to having rate offers above everyone else.
No bank now offers any fixed rate below 4% for terms of four and five years.
The lowest six month rate is now available from China Construction Bank. Heartland Bank has the lowest for one, two and three year terms. And SBS Bank now offers the lowest for terms of four and five years.
Over the past week, wholesale swap rates have risen about +10 bps for terms of one, two and three years. So some upward movement has returned to these background markets that are key to pricing funds used for mortgages. Today, international benchmark rates rose again with the 10-year US Treasury up +5 bps, and it is likely this rising pressure will find its way into domestic wholesale markets.
One useful way to make sense of these changed home loan rates is to use our full-function mortgage calculator which is also below. (Term deposit rates can be assessed using this calculator).
And if you already have a fixed term mortgage that is not up for renewal at this time, our break fee calculator may help you assess your options. But break fees should be minimal in a rising market.
Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at the moment.
| Fixed, below 80% LVR | 6 mths | 1 yr | 18 mth | 2 yrs | 3 yrs | 4 yrs | 5 yrs |
| as at November 16, 2021 | % | % | % | % | % | % | % |
| ANZ | 4.00 | 3.45 | 3.85 | 4.15 | 4.45 | 5.24 | 5.54 |
 |
4.19 +0.20 |
3.65 +0.16 |
4.09 +0.20 |
4.35 +0.20 |
4.69 +0.30 |
4.95 +0.20 |
5.19 +0.20 |
 |
3.89 | 3.49 | 3.89 | 4.15 | 4.39 | 4.79 | 4.79 |
 |
3.99 | 3.49 | 4.15 | 4.49 | 4.69 | 4.85 | |
 |
3.99 | 3.54 | 3.89 | 4.19 | 4.49 | 4.59 | 4.75 |
| Bank of China | 3.49 | 3.29 | 3.49 | 3.79 | 4.09 | 4.39 | 4.69 |
| China Construction Bank | 3.25 | 3.25 | 3.59 | 3.99 | 4.25 | 4.55 | 4.69 |
| Co-operative Bank | 3.34 | 3.34 | 3.69 | 3.99 | 4.24 | 4.69 | 4.85 |
| Heartland Bank | 2.90 | 3.45 | 3.60 | ||||
| HSBC | 3.69 | 3.29 | 3.59 | 3.84 | 4.19 | 4.49 | 4.69 |
| ICBC | 3.59 | 3.19 | 3.59 | 3.85 | 4.19 | 4.39 | 4.69 |
 |
3.79 | 3.15 | 3.45 | 3.69 | 3.75 | 4.29 | 4.49 |
 |
3.29 | 3.29 | 3.64 | 3.94 | 4.19 | 4.54 | 4.70 |
Comprehensive Mortgage Calculator
98 Comments
ASB has always been path breaking.
Feeling mighty fine about my early break to refix with ASB in July... Cue the domino effect for other bank rises in next few days.
Do they nail you with fees to break?
Nah we'd fixed one year in 2020 so were breaking to a slightly higher rate for longer. Only paid $20 admin fee.
We did the same in May, with minimal break fees.
I say old chap, we're reaching the dizzy heights with these latest rates.......
Better send the wife back to work.
TTP
Yikes. Out of interest, is anyone getting discounts off these "special" rates via their bank or a broker? If so what should one expect?
Was a different environment even 3/4 months ago when i re-fixed but i haggled 10-15 basis points off the carded rates from ASB and i'm just a joe blog citizen.
. 25 discount. Depending on how many multiple of millions you are borrowing
I pulled 0.20 off ASB in May, but even back then it wasn't as easy as it used to be.
We got .30% discount about two weeks ago.
No one cares how much is the interest rates, people will still keep buying houses from each other. 4% to real estate agent everytime. If a house is sold 5 times which we kiwis do ( buy from each other). Real estate agent made 20% without adding any value.
And we wonder why house prices are increasing at this pace. The middle man (leeches) is spinning the market and spoiling it for everyone in the country. I wonder if these real estate have any dignity in themselves. Probably not.
there is no dignity in money
1) This article is about interest rates
2) No one has to use a RE agent if they don't want to
3) RE agents don't make 4% commission of the whole slate price
4) Being envious and angry about how much money others make, will not help you in your own life
Fair response. Equally fair to suggest that the RE industry is more responsible than any other group for this current mess.
Really?
Prices are rising exponentially because rbnz and other banks lend at daft rates and gov did massive QE and there are too few listings. Clearly you know little of which you speak
RE agents are the scum and cartel in this country. Believe it or not.
Username checks out
How many RE agents do you personally know ngk?
Thats a massive generalisation.
A friend of ours is one and she’s actually one of the nicest people we know. She also works 7 days a week rarely gets a few free hours in the evening.
It’s a much harder job than people realise as you essentially have no life.
ASB sending smoke signals to the RBNZ just before the 24th ? I guess with their "Wait and Watch" policy they can probably spot that change is in the air. Dedicated to all those on here that said rates couldn't possibly rise.
Who said rates couldn't rise? No one as far as I can recall.
There were lots of people saying "rates simply can not rise and our government and RBNZ won't let that happen because housing is our economy" those kind of things for years now. Even now there are still lots of people thinking that way.
Plenty of people, even on here, were commenting saying rates cannot rise as it will "sink the economy". They were very much pushing the negative OCR angle.
I can't recall much at all of that on this website in 2021.
I have been bearish on how far the OCR will rise, but I never said it won't rise.
They're rising for certain. Whether it be 25, 50 (or more) basis points is anyone's guess.
The global market is pricing in a slowdown and a stalling or reduction of central bank interest rate rises. Fed, BoE, ECB all look likely to hold rates (or increase more slowly than expected). The banks know this, so they are squeezing some extra profit out of the upside, whilst their economists pump out opinion pieces about how scary rises in rates will expose borrowers on short-term deals. Disgusting really.
The global market is pricing in a slowdown and a stalling or reduction of central bank interest rates
Where are you seeing this?
Spot on. Wholesale rates say the opposite - they are pricing in increased costs. As fixed rates are (largely) funded off wholesale rates, this is simply a margin restoration play, like every business is doing as it sees the cost inputs increase. I assume still some way to go if one was to compare yields now with when swaps were last this high...
It's almost nostalgic seeing mortgage rates with a 5 in front of them again, like when you see an old advertisement which used to play on TV years ago.
If the other banks follow suit, there might be a few more 5s to come.
can't wait for good old 6 and my friend 7 to join the party
Bought our first home 8 years ago, at a rate of 5.15%. Those were the days :)
And on 22 June 2020 Interestconz announced the following--what a shame so many missed out on going long as these rates survived into the Autumn of 2021:
ASB's new four year 'special' is now 3.09%. Their new five year rate is 3.19%. Neither of these reductions threaten the lower rates at both BNZ and Westpac who have them each at 2.99%.
Similar reductions have been applied to their equivalent standard rates.
At the same time, ASB has cut its term deposit offers hard, with reductions of -10 bps to up to -30 bps. In fact, their term deposit rate card is now the lowest of any main bank and their highest offer is now just 1.70% for five years. The popular 6 month TD term is now only 1.65% and the one year term is now only 1.60%. No other main bank is lower. And it is probably a sign of things to come from the other main banks. There seems to be no competitive penalty for very low term deposit offer levels. Banks generally have more funds flowing in that they have demand to lend them out.
The rates you have quoted from the ASB are all wrong. Rates are heading up and are almost back to where they were a year or so ago. Long term rates are rising significantly. This may only be the start, I'm expecting closer to 2% on my TD in February for short term investments.
We're on a 160k combined income with 250k deposit and yet the ASB won't lend us more than 700k. Now with this rising interest rate, we feel like we're locked out of the market forever. Never have I imagined a day where 1/4 of a million deposit with a good income won't allow us to buy a median price house.
Why didn't you buy sooner ? Many on here saw this coming a mile away when inflation went through the roof. To be fair $950K still gets you a house. The window of opportunity for FHB was the last 12 months . The door has now been shut and there are more rate increases to come.
Was in a career transition the last 2 years. Only just got a decent job now. I'l love to find a place for 950k, even takanini is over a mil atm !
It makes you feel sick when you realize your money is worth nothing in NZ...
This country is not for average Joe or Jane to live and have a life. My best suggestion I have been giving to others is to leave for better markets. NZ passport is very powerful, so easy to get better jobs and prospects around the world. You will get better respect, don't pay ridiculous house prices and good experience. And when you have earned enough, come back and live a lavish life.
. NZ passport is very powerful, so easy to get better jobs and prospects around the world.
Trust me. Kiwis are not that special. This is the exceptionalism shining through. Organizations like KEA and NZTE are full of this kind of nonsense.
Only just getting your good paying job recently is what worried the bank and stopped them from lending you more. They like to see a good, solid, long employment history
Not right at all Yvil, if the bank were worried about employment they wouldn't lend to them period. What would be more likely is that they have high expenses which is reducing the ability to borrow...buy hey, that's just an assumption.
Or both. Averaging income over a longer period and looking at actual expenses incurred.
Could be. I am on the process of refinancing and switching banks and it was brutal. We are in a significantly better position than two years ago and it was much easier back then. They complained about my expenses being too high. I was like WUT?
We don't have any other loans, no holidays, no eating out, no takeaways, no expensive hobbies, no fun basically. The only thing I do spend a bit more on is supermarket ($350 week for family of 4) and Netflix (basic) Sheesh.
Must be horrible being interrogated like that
I just let the mortgage broker deal with that, but I still got mad when he came back to me with them saying my expenses were too high. I was like, dude, do I have to start eating crappy food now? I've already cut almost all other enjoyment of life out. But get this, we asked for a loan of 400K, made up of 300K fixed term and 100k revolving credit (which will be paid in full, so no interest owing). We also have over 100k in cash/investments. I have a loan with another bank currently, term just under 26 years. I am paying $1020 fortnightly. ANZ approved the loan, but only just. When I wanted a term of 15 years they said no, because it was only approved for 30 years. The repayments on the 15 year term is about $1070 fortnightly, so only a little bit more than now, but my income has increased since I took out my first loan so I figured I'd put the extra money towards the loan.
I can't believe how ridiculous it all is, and apparently (according to the mortgage broker) it's going to get worse.
In Auckland I would estimate 30-40% of houses are sold below 950k, and most FHBers should be looking below the median price.
Eliminate everything that's an apartment or anything that has less than three bedrooms. What's your normalised number?
Why would you eliminate apartments or anything less than 3 bedrooms, that makes no sense?
These are your "normal" first homes.
Exactly lower your sights. FHB expect to move into a house that's better than their parents are living in first up. Your simply going to have to look at apartments and 2 bed flats first up for several years then trade up later.
Exactly, 100%.
It's better to be on the ladder than crying on the floor.
I have to argue against this. First home buyers should be looking at homes they'd be comfortable in for 30 years, or until the mortgage is paid off.
Because with house prices at an all time high, there's a risk prices could fall in the next few years, effectively wiping out their deposit, leaving them with negative equity, and their chances of trading up later may vanish. If things turn bad for the housing market, their best chance would be to "tough it out", as others have said, just to keep their first home.
I'm not saying look at 4 bedroom with pool type houses, I'm just warning against attempting to speculate on house prices, while it has worked in the past, it's gone hand in hand with rising house prices. If house prices stop going up, buying an apartment or flat with the intention of trading up later may be a bad idea. Save your money.
I have to disagree with you there.
Buying an apartment or flat means you are not paying rent to someone else for the next X years while you are trying to save a deposit. It gets you on the ladder so you can sell down the track, in the same market which you are trying to buy your' dream' home.
Trying to save for a deposit will only get harder as it's unlikely prices will fall substantially.
Anyone making almost double the median income with a 250k deposit should have no problem at all buying a median house, FHB or not. This is just an indication of a severely broken market.
tomyam mentioned a recent career transition. Banks will be move conservative without a few years of track record in a given career.
Yes, but also the ability to save a 250k deposit on less than a combined income of 160k is definitely a strong position.
Didn't say he saved it huh...
Saved and invested every single cent of it.
Nice work!
but still renting so not that nice really.
I'll take my compliment back then *shrug*
lol. cheers.
"Now with this rising interest rate, we feel like we're locked out of the market forever"
This is what you want. Higher rates = more interest on your savings and lower house prices. Based on your numbers you are in a sweet spot.
Be patient, it's happening.
700/160 = 4.37.
So ASB are implementing a DTI of 4.5 by the look of it.
Very sensible of them.
I wonder if it's a taste of RBNZ things to come?
My own personal DTI limit is about 4.5. More seems mad.
Debt to income of 6.
Option - Take your deposit, buy a rental. Pay it off as quick as you can and Be patient.
With that kind of money in the bank you have options. Remember that. Yes you are currently feeling a pinch but you have more income than average. And a bigger deposit than most. You have options.
Also We are not living in normal times. This is a global pandemic. Borders are shut this is affecting what people do with thier money.
The fundamentals won't be this buggered forever.
During the correction they be begging you to take over a property/defaulted loan. Just keep stacking your cash... you'll get your chance.
I know it sucks, but to be fair, seems prudent by ASB. 4.4x income. Under new CCCFA rules coming in to play banks must assess a borrowers ability to repay very closely. The days of borrowing 8+x income should rightly be gone.
The travesty is the house prices! In theory, supply of credit should impact asset prices bought on credit. But then again, no one wants prices to drop... #conundrum
I think it depends on people's own expectations. If people expect to buy a 2-3 bedroom house within Auckland, that would be difficult. However there are still plenty of condo/apartment options that are within that price range. The problem is, everyone wants a house and wants to pay the least amount to get it.
Unfortunately times have changed. Expectations need to be lower. And with the recent interest rate hikes, FHB will find it impossible to buy a home as the house prices will continue to go up, and mortgage interest rates and LVE will restrict them from buying and getting into the market.
Still very low, bank analysts are covering up risk and increasing rates, RBNZ to follow.
NZ dollar seems worthless while spending to buy anything, crazy inflation.
The Cure for high prices is always high prices.
Rates will fall once more to new lows. Banks in for a good pump and dump over the next years or so until inflation falls off a cliff and rates fall once more
Yeah i wish that happens. I want people to keep suffering in this country from greed.
If we didn't have greed, always wanting better, we would still be living in caves with a life expectancy of 30 yo (or quite possibly extinct). Is that what you want?
I think ambition can be readily separated from greed.
Aren't they brothers? How do you separate them?
Here is a discussion around the life expectancy of hunter-gathers. It's not complete and not fact checked but it is an interesting discussion.
If that happens interest rates will be the last of your worries the average person would be screwed and money would be worthless .
Banks taking everyone for a ride. Global economic uncertainty means trouble ahead in 1 or 2 years from now. Why else are banks hiking mortgage rates without similar increases to term deposit rates? If we really were in a high interest rate cycle with a hot economy banks would be competing harder for our savings.
Yup. You can thank funding for lending programme from the RB and LSAP for the low appetite for depositers funds...
Why bother with the charade of competing in the Savings Pool if, by and large, savings aren't needed to create debt.
"But the RBNZ Banking License Ratios stipulate that there has to be an asset backing for all loans!" Sure they do. And what did the RBNZ do when 'things got tough'? Got tough on their ratios isn't the answer.
They don’t need our money when they can get it for low rate of central banks.
This is pretty curious. I had a 2 year 3.99% that I refixed to a very low rate this year. Now ASB have a 4.15% so we are right back to 2.5-3 years ago. Can house prices continue to hold with this increased pressure?
As I've said for years anything below the historic average of 5% is a good deal. For those who are buying you can only offer what you have available and you might be surprised that the bs does not always hold up to a real offer.
For those with a mortgage the percentage becomes less relevant the less you are borrowing. If there is room for extra payments they give a good return. Avoiding paying 4% interest is roughly the same as getting a 6% gross return on an investment, and every payment on a mortgage essentially gives you a compounding return.
"Can house prices continue to hold with this increased pressure?"
I think they will for a period of time simply due to the fact that 'we' are so far down the property rabbit hole, and so assured of the markets invincibility that the mantra will simply change from, "Rates aren't going up in the foreseeable future" to "Rates wont go up much further" or "Rates will peak and fall".
In the meantime people will keep piling in with a view that the party will continue, and they will be on the 'winning' side. Many will be "all in" but if the reality proves otherwise then the fallout will be severe for some.
I know its easy to speculate but surely when the stakes are as high as they are for many now, you HAVE to show some caution?
Prices will not come down because real estate agents don't want a decrease is their sucked blood intake. Leeches want to get fat and fatter.
They will not let the vendors sell and keep it artificially high. Ponzi will never deflate.
Agents don't care that much about the price, they just want the sale. That's what the standard commission structures incentivise. They'd be quite happy with lower prices if it meant higher volumes.
They'd be quite happy with lower prices if it meant higher volumes.
Yes. Nothing wrong with lower prices (commissions) if sales volume is higher.
Don't they have a fiduciary duty to the vendor to maximise the sale price?
Theoretically. In practice they work for themselves.
'Fraid it will... Look up the history of past bubbles.
NZD is not a large player in the world if inflation is high say around 5% interest rates should be 7% at best, the banks know this bond market known this in the end people with bonds are loosing money each year the bond market is huge and will not put up with this for ever. Interest rates have to go up with if inflation and bonds move higher, so if you are hoping for lower interest rate you are dreaming.
Bring on 10% interest rates.... the boulders in the liquidity stream are hidden by the volume of cheap money. Make money worth something again and you will see rocks rising to the surface all over the world and a property investors scrambling for dry land and bleating all the way.
Quite aggressive from ASB, swaps haven't increased that much over the last 2 weeks
They'd argue continually building pressure... like that hitting our wallets too!
I'm not sure any of the banks has yet raised rates to where they were relative to swaps prior to the last big jump...
I think bank shares are becoming a good contra to mortgage rates.
Bank Dividend yield Note
ANZ 5.00% (on NZX)
CBA 3.25% (on ASX, ASB's parent)
NAB 4.32% (on ASX, BNZ's parent)
WBC 5.16% (on NZX)
Possibly. Given that the Aussie and NZ have doubled down the housing bubble, it could be either good or potentially quite bad investing in bank stocks. These stocks and the banks' respective business models are the epitome of boomer investment paradigm.
The rates wont be at that level for long as the economy will start slowing down and not being productive so they will have to start dropping them again ,plus the RBNZ is still printing a shit load of fake Fiat dollars to keep propping up the biggest Ponzi Scheme in history. As Ive been saying for the last 2 years buy assets that produce an income and you shall benefit by the end of this decade.
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.