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Dramatic changes to home loan rates

Home loan report: The traditional Christmas hiatus on changes to home loan rates has been well and truly smashed this year.

Tuesday, January 15th 2008, 1:21PM
Up until recently there have been no changes to rates since late last year, however in the past two weeks there have been wholesale changes across the board, and big ones at that.

It started with ANZ and National Bank increasing all their fixed rates by 20 basis points each on January 7.

Since then, Westpac has matched these changes and Bank of New Zealand has made some far more sweeping changes to its rates.

BNZ's increases have ranged between 11 and 41 basis points.

The banks have been quick to lay the blame for these increases on what is happening in the global financial markets.

While banks have been active, many of the non-bank lenders have increased rates too.

A worrying omen for borrowers looking to avoid fixed rates and consider taking floating rates in the hope these will fall quickly when the Reserve Bank starts lowering its official cash rate (OCR), is that these are heading up too.

The next OCR announcement from the Reserve Bank is due on January 24.

Banks in Australia have taken the unusual step of increasing their floating rates when the central bank has kept its cash rate unchanged.

This week Cairns Lockie and General Finance both increased their floating rates.

Despite a slowing housing market it is likely to reiterate its pre-Christmas message that interest rate cuts are still some way off, late this year at best.

That means the options for borrowers are limited. What's more, there are no bargains out there.

If you are brave enough and believe rates will fall sooner rather than later, then a fixed rate of between 12 and 18 months may look attractive.

However, a less risky option is to go for something in the two to three year ranges, which are currently slightly cheaper.

Options which look decidedly unattractive are six-month and five-year fixed rates. The five-year rates look cheap, relative to other terms, but don't be fooled. They are at high historical levels and if you choose this term then you will miss out on falls when they do materialise.

The interest rate comparison section shows there is a wide range of rates from mainstream banks over the different terms.

Floating rates for all these banks sit at 10.55%. One and two-year standard fixed rates range from 9.60% to 9.80%. Out at the long end of the curve, five-year rates range from 8.90% for ASB to 9.15% for all the other banks.

« BNZ mortgage market share actually fellRate rise unlikely this week »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.05 3.95 4.49
ANZ Special - 3.55 3.45 3.99
ASB Bank 5.20 4.05 3.95 4.39
ASB Bank Special - 3.55 3.45 3.89
BNZ - Classic - 3.55 3.45 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 4.95 4.95 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
HSBC Premier 5.24 3.35 3.35 3.35
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 4.04 3.95 4.39
Kiwibank 5.80 ▼4.14 ▲4.30 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - ▼3.39 ▲3.55 3.89
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.25 4.15 -
Pepper Money Near Prime 5.64 - 5.44 5.44
Lender Flt 1yr 2yr 3yr
Pepper Money Prime 5.18 - 4.98 4.98
Pepper Money Specialist 7.59 - 7.39 7.39
Resimac 4.50 4.86 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - ▼3.55 3.39 3.89
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.49 3.59 3.89
The Co-operative Bank - Standard 5.15 3.99 4.09 4.39
TSB Bank 6.09 4.35 4.25 4.69
Lender Flt 1yr 2yr 3yr
TSB Special 5.29 3.55 3.45 3.89
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.55 3.45 3.99
Median 5.34 4.04 4.09 4.39

Last updated: 15 November 2019 4:16pm

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