It has happened. ANZ is matching Westpac's carded 2.29% one year fixed rate 'special'.
While it is not really a surprise, the nine day head start Westpac has had is.
ANZ isn't changing any other rates however (and Westpac didn't either).
Readers should expect most other banks to either cut their carded offers to a similar level, or offer lower rates for other terms, or match these lower offers informally, deal-by-deal.
Probably, most will do all three.
ANZ's special interest rates require a minimum 20% equity and an ANZ transaction account with salary direct credited, otherwise their standard rate applies. Specials are not available with their package discount offers.
ANZ is also cutting -5 bps from its term deposit offers for terms six months to two years.
Remember, the RBNZ's Funding for Lending program is in place, allowing banks to access money at the OCR's 0.25%.
If banks use that funding line, they can still keep their margins intact with rates down to about 2%.
Only one bank has drawn $1 bln in the FLP line late so far, doing so late last year. $1 bln is enough to fund about 2000 home loans.
Despite these big-bank cuts, they are not the lowest one year fixed rate available. HSBC offers the same term at 2.25%, and Heartland Bank still has a 1.99% fixed offer for one year.
One useful way to make sense of these new lower home loan rates is to use our full-function mortgage calculators.
And if you already have a fixed term mortgage that is not up for renewal at this time, our break fee calculator may help you assess your options.
Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at this time.
Fixed, below 80% LVR | 6 mths | 1 yr | 18 mth | 2 yrs | 3 yrs | 4 yrs | 5 yrs |
as at January 20, 2021 | % | % | % | % | % | % | % |
ANZ | 3.39 | 2.29
|
2.55 | 2.69 | 2.79 | 3.90 | 3.99 |
3.39 | 2.49 | 2.49 | 2.59 | 2.65 | 2.99 | 2.99 | |
3.39 | 2.49 | 2.49 | 2.69 | 2.79 | 2.99 | 2.99 | |
3.55 | 2.55 | 2.65 | 2.65 | 3.09 | 3.19 | ||
4.15 | 2.29 | 3.25 | 2.69 | 2.79 | 2.99 | 2.99 | |
Bank of China | 3.45 | 2.55 | 2.65 | 2.65 | 2.75 | 2.85 | 2.95 |
China Construction Bank | 4.70 | 2.65 | 2.65 | 2.65 | 2.80 | 2.89 | 2.99 |
Co-operative Bank | 2.49 | 2.49 | 2.69 | 2.69 | 2.79 | 2.89 | 2.99 |
Heartland Bank | 1.99 | 2.35 | 2.45 | ||||
HSBC | 2.79 | 2.25 | 2.25 | 2.35 | 2.65 | 2.79 | 2.89 |
ICBC | 2.89 | 2.89 | 2.45 | 2.45 | 2.65 | 2.89 | 2.99 |
3.39 | 2.49 | 2.49 | 2.59 | 2.65 | 2.89 | 2.99 | |
[incl Price Match Promise] | 2.89 | 2.29
|
2.49 | 2.49 | 2.65 | 2.99 | 2.99 |
In addition to the above table, BNZ has a unique fixed seven year rate of 5.20%.
Fixed mortgage rates
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26 Comments
My mortgage is with them, taken out at the best available rate at the time. I expect I'll be able to renew at a competitive rate too, they were quite flexible last time. Happy to keep my money in the local economy, although there's always SBS/TSB/Heartland for that too.
Their floating rate is all but the lowest? But agree with the other respondent - the profits stay onshore. I'd prefer there were no profits, but the SOE Act prevents this. If the government wanted to take a cogent step towards winding back neoliberalism instead of just complain about it, they'd change the requirement to run SOEs at a profit to supply dividends to the government. It's currently a stealth tax on every NZer.
Correct. My rates are floating at 2.9% currently. I can also get a 2.3% fixed rate with the PSA discount. With their recent announcement that they will be removing the PSA arrangement, I intend to bank elsewhere. Also Kiwibank has terrible technology. They don't offer any smartphone payment options, despite every other major bank offering this. I'm a millennial, so this is important haha. Westpac or ANZ here I come.
Just looking at t he trends I can pick out in the rate chart, it tends to drop in tough times for obvious reasons, then jack up about a year after the trouble, until they realise shit is still screwed and continue to drop rates. So maybe a hike at the end of the year for a year or so before another drop? might work out well to lock in a small portion for 2 or 3 years at some point from mid year if its up for renewal?
Any thoughts?
"Remember, the RBNZ's Funding for Lending program is in place, allowing banks to access money at the OCR's 0.25%."
Pleased to see the article is not suggesting that the banks are then lending that money (although it doesn't say they're not either). They are not. That money goes into their reserves and they create new money (out of thin air) to lend. For every $1 million they access from the Reserve Bank they can create and lend $9 million or more.
Trouble is that lending is going mostly into the housing market instead of into small and medium business - the productive sector of the economy.
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