Another mortgage major trims a key mortgage rate. Even if it is not a huge cut, it does drop them to the lowest level among their main rivals

Another mortgage major trims a key mortgage rate. Even if it is not a huge cut, it does drop them to the lowest level among their main rivals

BNZ has separated itself from the main pack with a new lower two year fixed home loan rate.

It has launched a 3.54% rate, -5 bps below all its main rivals for this tenor.

Their residential investor rate is also trimmed, now to 3.79%.

Only HSBC Premier (3.35%) and China Construction Bank (3.19%) have lower two year fixed offers.

This new rate is also lower than the 3.55% one year fixed rate on offer from Kiwibank. So among all banks except the two just mentioned, this is the lwoest rate in the market at this time.

This change comes after sharp rises in wholesale rates at the end of last week. Two year swap rates edged up to 1.02% and capping a +12 bps rise on the past ten days. Overnight uncertainty in the oil markets may interupt the new trend.

Here is the full snapshot of the advertised fixed-term rates on offer from the key retail banks.

Fixed, below 80% LVR 6 mths  1 yr  18 mth  2 yrs   3 yrs  4 yrs  5 yrs 
as at September 16, 2019 % % % % % % %
               
ANZ 4.29 3.65 3.99 3.59 3.99 4.85 4.95
ASB 4.29 3.65 3.75 3.59 3.89 4.19 4.29
4.79 3.65 4.55 3.54 3.99 4.35 4.45
Kiwibank 4.79 3.55   3.59 3.99 3.99 3.99
Westpac 4.99 3.65 4.79 3.59 3.99 4.35 4.45
               
Co-operative Bank 3.69 3.69 3.75 3.75 3.99 4.19 4.29
China Construction Bank 4.70 3.19   3.19 3.19 4.95 4.95
ICBC 5.15 3.79 3.79 3.75 3.99 4.29 4.39
HSBC 4.65 3.35 3.35 3.35 3.35 3.35 3.35
HSBC 4.29 3.69 3.69 3.69 3.99 4.49 4.49
  4.55 3.85 3.89 3.79 4.05 4.45 4.55

In addition to the above table, BNZ has a unique fixed seven year rate of 5.70%.

All carded, or advertised, term deposit rates for all financial institutions for terms of less than one year are here, and for terms of one-to-five years are here. And term PIE rates are here.

Fixed mortgage rates

Select chart tabs »

The '6 months %' chart will be drawn here.
Loading...
fixed rate 
floating rate
unweighted
The '1 year %' chart will be drawn here.
Loading...
fixed rate 
floating rate
unweighted
The '2 years %' chart will be drawn here.
Loading...
fixed rate 
floating rate
unweighted
The '3 years %' chart will be drawn here.
Loading...
fixed rate 
floating rate
unweighted
The '4 years %' chart will be drawn here.
Loading...
fixed rate 
floating rate
unweighted
The '5 years %' chart will be drawn here.
Loading...
fixed rate 
floating rate
unweighted

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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.

18 Comments

Comment Filter

Highlight new comments in the last hr(s).

The good news for house buyers continues - especially first home buyers and investors.

TTP

as a FHB, no, it's not good news for FHBs. I would rather see interest rates go up.

If bank lending rates went up, FHB's would soon be squealing - and for very good reason.

TTP

If bank lending rates went up, FHB's would soon be squealing - and for very good reason.

Reaching for your inner DGM. Let's try another tack. One key reason why interest rates risie is because house prices are on fire, So ultimately rising interest rates are a signal that the FHB is making a good decision.

J C like many here, you're getting cause and effect mixed up, you're doing well when you say "interest rates risie is because house prices are on fire" (although inflation is more what the ORC targets) but then you imply that "rising interest rates are good as they mean house prices will rise" You've put the cart in front of the horses there. Cause: interest rate movement - effect house price movement, not the other way around

Rising house prices "is" inflation. And far more dangerous than the CPI construct. Excessive leverage has flowed into asset prices and ZIRP or NIRP support\ asset prices.

So back to the point: monetary policy can be used to stymie asset speculation. One of the biggest criiticisms leveled at ALan Greenspan is that interest rates were kepr too low, thereby causing a speculative housing bubble. Of course, that was pre-GFC. Interest rates have been driven lower, alongside QE, to stimulate speculation.

We seem to be heading more towards the extreme end of the credit cycle (although it could go well negative this time). This cycle has repeated over and over in history. It’s never good for investors or FHBs left holding the bag, although always good for value investors waiting for the inevitable turn. So soon we even forget the housing and loose credit lessons of the GFC in the US and Europe?

This cycle has repeated over and over in history.

No it hasn't. Point to another period in history when ZIRP became the norm.

I meant the general credit cycle - loose credit in a boom, followed by a bust and a tightening of credit. Has happened over and over. Yes, this one is extreme; certainly uncharted territory in that regard, although Japan has been there for a while, and their housing market went to rock bottom for a long time. We cannot assume everything will be hunky dory with the consequences of this cycle. We’ve had a property mania, with a lot of cheap credit.

Inching closer to the 3.49% I called at end of Sept after the 0.5% OCR cut

Probably nowhere near the terminal rate, but a reasonable half-way stop. Lots going on in the World...and none of it good. Bond rates spike probably won't last long, but long enough to scare a few holders out, and will be fun to watch. There is no 'safe' alternative to what we have now embarked on ( lower rates) - and lower asset prices results from all of it - all of them, and much, much lower! Are we all ready?!!

All very well bw......

But people still need food/water - and a roof over their heads.

And remember: there's nothing quite like freehold property if/when times get tough.

TTP

It ain't your's till the mortgage is paid off.. You're just renting it from the bank till then ;)

Not true, the property is under your name, not the bank's, you can choose to paint it, renovate it, get a room mate in sell it etc… the mortgage is an encumbrance which has nothing to do with ownership.

True about needing a roof, but if too high a price is paid and too much credit is used, it can really suck as an investment, and can also result in mortgagee sales galore. See GFC.

Its a race to 2.99% and even lower......

Looks like it. But where will it stop??

Minus a zillion percent, so the banks will pay the property speculators squillions in interest to top up their poor rental yields on their rediculously overpriced polystyrene and plaster boxes.. at least thats what some here seem to want.