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Mortgage Rates Daily Commentary
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Why house price growth will continue

House price inflation is unlikely to radically slow this year after a strong end to 2019, according to leading economist Tony Alexander: [READ ON]

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Home loan rates expected to fall again

Floating and short term mortgage rates are likely to come down again if, as expected, the Reserve Bank cuts its official cash rate next week.

Thursday, October 16th 2008, 6:22AM

by Maria Scott

Economists expect it could, on Thursday, move the rate by as much as one percentage point. Current market rates are probably already reflecting some of the anticipated cut in the official rate but there is still likely to be some movement in mortgage rates after the Reserve Bank’s next move.

The cheapest rates in the home loan market are to be had over two year terms at present but increasingly economists and advisers are suggesting that borrowers choose floating rates in the expectation that these will continue to fall over coming months as the Reserve Bank implements a succession of cuts. There are already several sub-10 per cent floating rates available.

Action by governments throughout the world to stabilise the banking system – including the deposit guarantee scheme in New Zealand – will, it is hoped, mark the beginning of a recovery. But the banking system will be reshaped by government interventions. Banks will have to account to taxpayers and costs will be under pressure.

Already, some of the cheapest loans in the New Zealand market are going to borrowers who can put down large deposits and this trend will continue. Lenders will be less willing to compete on price and much more interested in signing up, and keeping, low-risk borrowers.

New Zealand’s mortgage market has been unusual in having offered the cheapest borrowing over fixed terms but it is unclear whether that pattern will continue. Several specialist lenders have already withdrawn all their fixed rates.

Homeowners and property investors who can afford to may find that the best move they can make now is to reduce their mortgages. Debt will be a dirty word for some time to come.

« Adding Kiwi ingenuity to the lending marketOCR cut to 7.5% »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.05 4.05 4.49
ANZ Special - 3.55 3.55 3.99
ASB Bank 5.20 3.89 4.05 4.39
ASB Bank Special - 3.39 3.55 3.89
BNZ - Classic - 3.49 3.55 3.89
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 5.65 4.75 4.75 -
Credit Union North 6.45 - - -
Credit Union South 5.65 4.75 4.75 -
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 ▼4.65 ▼4.80 -
HSBC Premier 5.24 3.54 3.54 3.69
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 3.97 4.05 4.39
Kiwibank ▼5.15 4.20 4.30 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.45 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 ▼4.45 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - 3.39 ▲3.55 3.89
Sovereign 5.30 3.89 4.05 4.39
Sovereign Special - 3.39 3.55 3.89
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 4.19 4.35 4.69
Lender Flt 1yr 2yr 3yr
TSB Special 5.29 3.39 3.55 3.89
Wairarapa Building Society ▼5.50 ▼3.95 ▼4.05 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.39 3.55 3.99
Median 5.34 3.97 4.05 4.39

Last updated: 24 January 2020 8:55am

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