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Mortgage Rates Daily Commentary
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OCR cut of 50 points forecast

Home Loan Report: If you are in the market for a mortgage you should be able to obtain a fixed rate deal that is significantly cheaper than what you would have paid a week or two ago.

Thursday, May 15th 2008, 5:50AM
Most of the large banks have reduced at least some of their fixed rates over the past week. The steepest reductions have been for one-year money although there have also been reductions over three and four years.

As reported on Good Returns yesterday ANZ, National Bank have dropped their one-year rates 55 and Westpac has shaved 45 points off its rate.

On $100,000 of borrowing that works out at savings of $550 and $450 a year.

Fixed rate loan costs are coming down because the banks' funding costs over these periods are falling. This is being fuelled in part by increasing expectations that official rates in New Zealand will be coming down sooner rather than later. These expectations have been heightened by signs that the economy is weakening quickly under the strain of high rates.

Unemployment is rising, as confirmed by the latest statistics on the labour market, released last week. It may be small compensation if you have lost your job that it will cost less to refinance your mortgage than it would have a few weeks ago.

Economists have been pulling forward their predictions of a cut in the official cash rate, with September seen as a strong possibility. ASB is now talking about a 50 point cut in September.

The changing outlook on rates is convincing economists and advisers that shorter term fixes are the best bet now. Westpac says that those willing to take a punt might go for six months but "for those who require more certainty, given that funding costs could still blow out, we suggest a one-year rate should see us through the turmoil".

Chris Downes, a Mike Pero Mortgages broker in Christchurch says clients are asking for one year and 18 month terms.

Neil Inns, of Auckland broking firm Professional Finance says borrowers should tailor their financing to what they can afford rather than fixing on the popular recommendation of the moment. He favours splitting borrowing over a variety of terms, but even so, he would not fix for longer than 3 years at present.

« Lender strife for PioneerConflicting views on interest rate movements »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 7.74 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.14 6.79 6.65
ASB Bank 8.64 7.14 6.75 6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.14 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.74 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 6.79 - -
Co-operative Bank - Owner Occ 8.40 6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.49 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.89 6.55 6.35
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.74 7.35 6.99
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.65 7.25 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.74 7.09 6.95
SBS Bank Special - 7.14 6.49 6.35
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.14 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.84 7.35 6.99
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.24 6.75 6.39
Median 8.64 7.19 7.17 6.65

Last updated: 20 June 2024 10:39am

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