Kiwibank has reduced its four and five year fixed mortgage rates by 29 bps and 19 bps respectively, effective immediately. This move is the first by another bank to respond to rate reductions by ASB late last week, and these Kiwibank reductions match the ASB rates for these terms. Both banks have opened up about a 0.25% advantage over other banks for longer term rates. ASB's earlier moves down for shorter term fixed mortgage rates matched Kiwibank and the rest of the market. With a growing realisation in moneymarkets that official rates will be lower-for-longer, both here and in Europe / USA, wholesale swaps have been trending lower as are the 90 day bank bills. This is opening up some margin that can be used to compete for mortgage market share.
In data released yesterday by the RBNZ, housing credit growth in January was only 3.3% year-on-year, still at its low point since current RBNZ data began in 1998. Despite low and stable official rates, there is still noticeable jockeying for position in mortgage rates - nine institutions changed rates in the past 15 days. The latest mortgage rates are in comprehensive detail on our mortgage rate page here.
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