ASB has matched BNZ by offering a one year mortgage 'special' at 4.35%.
It has also cut most (but not all) other mortgage rates, both 'specials' and standard carded rates.
It's six month rates however are unchanged, as are their 18 month rates.
However their one year standard rate has been reduced by -20 bps to 4.85%.
Their two year 'special' rate has also been cut by -20 bps to 4.69% (the same as its 18 month rate).
Their two year standard rate has been cut by -10 bps to 5.15%.
Their three year 'special' rate has been cut by -20 bps to 4.79% while their standard rate falls to 5.25% 4.79%.
Their four year rates (not available at BankDirect) fall by -30 bps to 4.99% and 5.25% respectively.
Their five year rates have also fallen by -30 bps to 5.09% and 5.35% 'special'/standard.
These changes mean ASB now has only one 'special' rate above 5%.
It also means they now have the lowest five year rate in the market at 5.09%.
And it means ASB has joined the group of New Zealand banks that are offering a one year rate lower than their Australian parent. (CBA's one year rate is 4.49% - although CBA's two year fixed rate is 4.29%.)
BankDirect and Sovereign have made identical changes.
Now that ASB has moved we are likely to get sharp rate reductions from both Westpac and ANZ. Kiwibank will also be forced to move lower.
Challenger banks will also need to readjust their pricing. The prospect of a mortgage rate that starts with a '3' no longer seems unreasonable.
Wholesale rates have stopped falling but they are low enough to support these new low rate offers, and still allow borrowers to negotiate hard for below-card rates.
The mortgage market is all about haggling, especially if you have at least 20% equity in your property.
See all banks' carded, or advertised, home loan rates here.
Almost all home loan competition is now back focused on the interest rate. Non-rate cash incentives are still there for some banks and while we thought they might disappear altogether, they haven't and they are still worth keeping an eye on. ASB however has removed its All Blacks $300 promotion. You can see see the current non-rate home loan incentives here.
The new floating and fixed mortgage rates compare at 6:00 pm today (Monday) as follows:
| below 80% LVR | Floating | 1 yr | 18mth | 2 yrs | 3 yrs | 5 yrs |
| % | % | % | % | % | ||
 |
6.24 | 4.69 | 5.15 | 4.89 | 5.59 | 5.79 |
 |
6.25 | 4.35 | 4.69 | 4.69 | 4.79 | 5.09 |
 |
5.99 | 4.35 | 4.69 | 5.19 | 5.65 | |
 |
6.15 | 4.79 | 4.65 | 4.99 | 5.50 | |
 |
6.15 | 4.99 | 5.19 | 4.69 | 5.19 | 5.65 |
 |
6.20 | 4.69 | 4.79 | 4.79 | 4.99 | 5.59 |
 |
6.35 | 4.49 | 4.49 | 4.49 | 5.29 | |
|
6.14 | 4.69 | 4.69 | 4.69 | 4.99 | 5.59 |
 |
6.24 | 4.69 | 4.69 | 4.69 | 4.99 | 5.75 |
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