ANZ moves to raise rates back up to levels first adopted by rival ASB, taking some longer term rates back closer to 5%

Well, that didn't take long.

ANZ is raising rates for all fixed term mortgages from six months to five years.

Now ANZ only has an advantage over its main rivals at the one year fixed rate and only for six basis points.

Further, its five year increase of +30 bps takes it closer to having a 5% mortgage rate, and when that happens it will be the first time we have seen that in 26 months (BNZ in August 2019).

Update: TSB has also raised its fixed rates.

Here is our earlier report before the ANZ rate announcement that closed off some of the exploitable advantages.

Earlier, both HSBC and ICBC raised rates.

Basically, the current levels are coalescing around levels first moved to by ASB.

And this is despite overall bank reluctance to take up the Reserve Bank Funding for Lending option. So far only $6 billion of the $28 bln the RBNZ allocated for the programme has been taken up. The cost to a bank is the Official Cash Rate, for a term of three years. The reluctance may be because the OCR is expected to rise sharply from its current 0.25%, and starting in early October.

One useful way to make sense of these changed home loan rates is to use our full-function mortgage calculators. (Term deposit rates can be assessed using this calculator). (Our calculators are all back running now.)

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 September 29, 2021	%	%	%	%	%	%	%
ANZ	3.55 +0.16	2.79 +0.19	3.09 +0.24	3.25 +0.26	3.49 +0.09	4.59 +0.30	4.89 +0.30
	3.55	2.85	3.09	3.25	3.55	3.99	4.29
	3.55	2.85	3.09	3.25	3.55	3.99	3.99
	3.55	2.95		3.15	3.49	3.89	4.19
	3.29	2.85	3.09	3.25	3.49	3.99	4.29
Bank of China	3.45	2.45	2.65	2.85	2.99	3.65	3.95
China Construction Bank	2.65	2.65	2.65	2.85	3.25	3.55	3.99
Co-operative Bank (*FHB only)	2.85	2.65*	3.09	3.25	3.49	3.99	4.29
Heartland Bank		2.15		2.45	2.65
HSBC	2.89	2.69 +0.29	2.89 +0.24	3.09 +0.30	3.29 +0.30	3.59 +0.20	3.84 +0.15
ICBC	2.85	2.45 +0.10	2.65	2.85 +0.10	3.15 +0.10	3.65 +0.20	3.95 +0.20
(*FHB only)	2.79	1.99*	2.69	2.89	3.09	3.49	3.79
	2.89	2.79 +0.24	3.09 +0.30	3.25 +0.30	3.49 +0.24	3.99 +0.30	3.99