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Mortgages

Mortgage Rates Daily Commentary
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Bank of mum and dad alive and well; Danger OCR might need to be hiked in 2026

Nearly one in three parents of children wanting to buy their first home can afford to help them with their mortgages. [READ ON]

Potential mortgage borrowers might need to get their new homes of investment properties in the next year as Westpac says there is a risk the RBNZ might cut the OCR too far and start raising rates again in 2026. [See here]

 

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Rates start easing

Home Loan Report: After a period of strong rises in home loan rates they are now starting to ease back, and by reasonably significant margins.

Tuesday, August 8th 2006, 6:30AM

by Philip Macalister

The trend started at the end of last with ASB Bank and its two related companies easing their mid-term fixed rates. They have been joined today by Bank of New Zealand which has lowered all its fixed rates, and some such as the two-year rate by 20 basis points.

The trigger for this easing comes from downward pressure on wholesale interest rates largely driven by weaker than expected gross domestic product numbers in the United States.

In New Zealand there is little expectation that the Reserve Bank will increase its official cash rate again in this cycle and two-year swap rates have fallen back from 7.47% a couple of weeks ago to be sitting around the 7.20% mark.

This has meant the margin for lenders has been increasing and some banks are choosing to react by lowering their home loan rates.

There are still differences between economists on what is the best option for a new home loan or refinance. BNZ is suggesting people go for three years, while Westpac is suggesting borrowers go short with a term of 18-months. ANZ is pushing the concept of loan splitting and ASB says that the "2-year fixed rate appears to offer a reasonable mix of interest rate protection in the near-term and opportunity in the medium-term."

Also some differences are emerging in rate hold policies. ANZ has recently lengthened the amount of time it will hold a rate for a customer while HSBC have shortened its term.

It has reduced its rate hold period from 35 days to 14 days and decided that if a customer wants to extend the hold period beyond 14 days they will charge an upfront fee of 0.20%.

What’s on offer at the moment?


The two main trends continue; that is floating rates are fixed solidly in the same position they have been for months. The second is that longer term fixed rates are lower then shorter term ones.

Floating or variable rates range from 8.50% through to 9.95% with the banks sitting at the top end of the range on 9.55%.

Of the three fixed rate categories surveyed in this week’s report Southern Cross Building Society comes out with the lowest rates in all groups. It is unusual for one lend to be the lowest across the board.

Its one year rate, at 7.85% is 15 basis points lower than the next on the table. The highest rate is GEM Home Loans at 9.00%. Amongst the banks BNZ’s standard loan is the highest at 8.60% while many of its competitors are around the 8.40% mark.

In two-year fixed we have Southern Cross at 7.75% and quite a few lenders under 8.00%. Banks though are clustered at 8.30%.

In three-year fixed Southern Cross is again 15 basis points lower than its nearest competitor at 7.65% and there are 17 lenders under the 8.00% barrier.

To compare rates and see what is on offer go to Good Returns comprehensive rates table here

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 4.94 - - -
AIA - Go Home Loans 7.49 ▼5.79 ▼5.49 ▼5.59
ANZ 7.39 6.39 6.19 6.19
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 5.79 5.59 5.59
ASB Bank 7.39 ▼5.79 ▼5.49 ▼5.59
ASB Better Homes Top Up - - - 1.00
Avanti Finance ▼7.90 - - -
Basecorp Finance ▼8.35 - - -
BNZ - Classic - 5.99 5.69 5.69
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One 7.54 - - -
BNZ - Rapid Repay 7.54 - - -
BNZ - Std 7.44 ▼5.79 ▼5.59 5.69
BNZ - TotalMoney 7.54 - - -
CFML 321 Loans 6.20 - - -
CFML Home Loans 6.45 - - -
CFML Prime Loans 8.25 - - -
CFML Standard Loans 9.20 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - ▼5.69 - -
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Owner Occ 6.95 ▼5.79 ▼5.59 5.69
Co-operative Bank - Standard 6.95 ▼6.29 ▼6.09 6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - ▼5.99 ▼5.89 -
First Credit Union Standard ▼7.69 ▼6.69 ▼6.39 -
Heartland Bank - Online ▼6.99 ▼5.49 ▼5.39 ▼5.45
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.60 6.65 6.40 -
ICBC 7.49 ▼5.79 ▼5.59 5.59
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 7.25 6.89 6.59 6.49
Kiwibank - Offset 7.25 - - -
Kiwibank Special 7.25 5.99 5.69 5.69
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society ▼7.94 5.95 6.09 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank ▼7.49 6.95 6.29 6.29
SBS Bank Special - 6.15 5.69 5.69
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo ▼4.94 5.15 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.75 - - -
TSB Bank 8.19 6.49 ▼6.39 ▼6.39
TSB Special 7.39 5.69 ▼5.59 ▼5.59
Unity 7.64 5.99 5.69 -
Unity First Home Buyer special - 5.49 - -
Wairarapa Building Society 8.10 6.05 5.79 -
Westpac 7.39 6.39 6.09 6.19
Westpac Choices Everyday 7.49 - - -
Westpac Offset 7.39 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 5.79 5.49 5.59
Median 7.49 5.99 5.79 5.69

Last updated: 5 December 2024 10:06am

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