Kiwibank is resurrecting a cash incentive for mortgage borrowers as it strives to spruik activity in a housing market stuck in the doldrums.
The bank is resuming an offer used earlier in the year of a 1% cash contribution up to $10,000 on new home loans of at least $300,000 for borrowers with at least 20% equity. The loan would need to be $1 million to qualify for $10,000.
Other banks are also offering non-rate incentives to borrowers. Notably BNZ is offering a cash incentive of up to $20,000 for loans worth at least $400,000.
“We last did this offer in June, which proved to be popular with customers, so this cash offer is back to continue helping more Kiwi achieve their home ownership goals. As living costs continue to rise, it’s great to put money back in the pockets of Kiwis who are either buying a home or may be using our refinance package to switch over," says Pip Maxwell, Kiwibank's Senior Product Manager for Home Lending.
Kiwibank's 1% cash contribution offer is available for new Kiwibank home loan applications applied for between September 5 and September 25.
Banks typically strive to spruik housing market activity in spring. Over the weekend Westpac cut its longer term mortgage rates, albeit it increased its shorter term ones at the same time.
Last month Kiwibank CEO Steve Jurkovich told interest.co.nz there may be a pick up in housing market activity in spring, but not at the levels of recent years.
The latest monthly Real Estate Institute of New Zealand figures, for July, show REINZ's House Price Index down 11% from the peak last November, sales volumes down 37% year-on-year to 4,678, the median number of days to sell up 16 to 47, and inventory up 108% year-on-year to 26,358.
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