Lower and lower, that is the continuing track for fixed mortgage rates.
The New Zealand subsidiary of the Bank of China has launched a 3.15% rate for one and two year fixed home loan contracts, setting a new low in the New Zealand mortgage market.
That is a -35 bps and -40 bps cut respectively.
(Rates under 3% seem to be now a market possibility?)
It has also cut its 'special' floating rate to 4.89% by -20 bps. This is the only floating rate below 5% from any bank.
These new rates beat the China Construction Bank 3.19% rates and are substantially lower than rates offered by the main retail banks in New Zealand.
In fact, they have a -50 bps advantage over these main bank for the popular one and two year fixed terms.
China's banks have 'arrived' in the local retail home loan market and the impact will likely be long-term. We will soon release a profile explainer of these banks' presence here
Wholesale swap rates fell in the latest trading session, ending a recent rising turn.
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 18, 2019||%||%||%||%||%||%||%|
|Bank of China||3.99||3.15||3.70||3.15||3.79||4.35||4.45|
|China Construction Bank||4.70||3.19||3.19||3.19||4.95||4.95|
In addition to the above table, BNZ has a unique fixed seven year rate of 5.70%.