Kiwibank offers 5.99% 30 mth mortgage rate

Kiwibank introduces 30 month mortgage rate at 5.99% due to "current environment"; Says for limited time

14th Oct 11, 8:43am by Alex Tarrant

Kiwibank has announced a new 30 month mortage rate of 5.99% for a limited time, available to both new and existing customers.

The rate is about 30 basis points lower than the lowest two year rates offered by the major Australian banks, and about 70 basis points below the major banks' three year rates.

"The current environment has given rise to an opportunity to offer a lower longer term rate and we want to pass this on to our customers," Kiwibank CEO Paul Brock said.

“This presents a great opportunity to lock in a low longer term rate to provide some certainty in what are volatile times,” he said.

See and compare all mortgage rates here.

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13 Comments

by Nicholas Arrand | 14th Oct 11, 8:50am 1318535403

When the mortgage rates have a '3' in front of them, it will be a good time to lock-in. We still have some way to go before fixed is better than floating.

by skudiv | 14th Oct 11, 8:57am 1318535852

Yup, I don't see any upside pressure comming.

by The General | 14th Oct 11, 8:58am 1318535892

If inflation is going to be around 3%+ I am ppreety sure interest rates will have to be above this at least?

by Nicholas Arrand | 14th Oct 11, 9:03am 1318536198

Inflation isn't going to be the problem, sir. CPI increases, maybe. But asset prices will fall, as people have to sell whatever they have to pay for the costs of living and to repay loans. In effect, a true deflationary environment. Why do other Western countries have 'zero' interest rates and high CPI numbers? Because the underlying environment is...deflationary. Sure, they're trying to stop it. But have they been successful? Will they be? My suggested answer is :No.

by steven | 14th Oct 11, 12:57pm 1318550246

That's easy, no to inflation, deflation.....3% but 10% likely.....for maybe 5 years.....maybe 6....(of drops, might dead cat bounce a bit)....so interest rates of 3% so the NET difference is 13%.....ho hum.

Interest rates above?, no the US OCR is something liek 0.25%....problem is if no one is borrowing you wont get a return because the bank isnt.....

regards

by MortgageBelt | 14th Oct 11, 10:34am 1318541650

No, no - this can't be right. The bank economists are still beating the drums that the OCR will be tracking upwards and the floating rate will be rising next year (always next year).

This is Westpac's copy & paste they are regurgitating every week in their economic report: "Yet the trend of rising rates over the longer term remains intact. Based on our current forecasts of the OCR rising to 6% over the next three years, fixing for two or three years is likely to result in a lower overall interest bill than remaining on floating."

More likely to be rate cuts as conditions deteriorate ....

by steven | 14th Oct 11, 12:58pm 1318550313

yep.....but you cannot cut much further....

regards

by MortgageBelt | 14th Oct 11, 10:56am 1318542997

ANZ's forecasts: "A rate hike in 2011 is now highly unlikely, and in fact, we would not be surprised to see further downside in short end rates, or rule out the possibility of the market moving to price in cuts. That’s not to say we expect a cut, but as we saw in

Australia, there is nothing to stop a nervous market pricing one in. This suggests there is still some downside at the short end."

by cam | 14th Oct 11, 11:02am 1318543357

Hmmm is it the banks starting to fight for the few sales that are happening.

A mortgage rate war with these "special offers" to get some market share.

by goNZ | 14th Oct 11, 12:59pm 1318550367

sorry all you savers out there - wont be long before you have to PAY the bank to hold your money ??

by steven | 14th Oct 11, 1:22pm 1318551760

Thats whats happening to corporates in the USA I believe....

Dont worry about savers, (or maybe laughing at them, its not over til the fat lady sings) if as I expect we tumble into a depression the value of their money will increase by deflation (could be 10%) plus any interest rate...so they could see a real 12%.....and the great thing for them is they get taxed on the interest rate of 2%...so they could easily get to laugh at the Govn....and debtors like me.

regards

by steven | 14th Oct 11, 1:02pm 1318550550

Ho hum......5.99% is a bit of a hard call (to ignore), given volitility and hardly paying any premium over floating.....doesnt seem to be a huge premium to pay to take away any short term "disruptions" for 2.5 years....

NZ Bonds are being sold at 5% ish....can they go lower.....? so how low can the floating go.....5.5%?

regards

by cam | 14th Oct 11, 4:20pm 1318562429

I have been getting 5.5% floating for a few months now with ASB.