Update 2: Kiwibank has followed quickly too. The unique rate hike for them is taking their three year fixed up to 4.49%, the highest of any bank for that term, and up +50 bps in one hard hit.
Update 1: ASB has followed ANZ by raising fixed home loan rates further.
In fact, ASB has brought back a two year rate over 4% for the first time since March 2019. And it is well over 4% at 4.15%.
ASB's new rate levels are the highest of any bank in the heart of the competitive 1-3 year offer card. And their move probably signals a general move higher, even higher than yesterday's ANZ changes that led this latest push.
Here is our earlier report on the ANZ move up.
ANZ is the next bank to raise fixed mortgage rates, upping rates by between a further 10 basis points and 30 basis points.
These new rates match Westpac at one year and two years fixed, and include a new market high for a three year rate.
In fact, ANZ has only one standard rate below 4%, its one year 3.94% standard rate.
Most banks have standard rates, although some like ASB don't. Standard rates apply to borrowers who don't qualify for 'specials' and 'specials' basically require 20% equity in the property being financed.
Heartland Bank still has the lowest fixed rate offers, and how long they can last must be open to question.
Bank of China, and ICBC also have rates that are market lows.
While wholesale rates slipped a little today, they are holding on to most of their sharp recent run-up.
The next direction could depend of two events that happen over the next few days. On Tuesday, Governor Arian Orr is out jawboning markets ahead of Wednesday's Reserve Bank Financial Stability Report. Moral suasion is now weapon in his armory. And tomorrow (Tuesday) the Reserve Bank of Australia is very likely to confirm some changed policy positions. A lot will depend on how markets react to this announcement at 4:30pm (NZT).
One useful way to make sense of these changed home loan rates is to use our full-function mortgage calculator which is also below. (Term deposit rates can be assessed using this calculator).
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. But break fees should be minimal in a rising market.
ANZ also increased term deposit rates +5 bps to +30 bps, with a top rate of 3.00% for five years
Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at the moment.
| Fixed, below 80% LVR | 6 mths | 1 yr | 18 mth | 2 yrs | 3 yrs | 4 yrs | 5 yrs |
| as at November 2, 2021 | % | % | % | % | % | % | % |
| ANZ | 4.00 | 3.34 +0.10 |
3.69 +0.15 |
3.99 +0.29 |
4.24 +0.30 |
5.24 +0.20 |
5.54 +0.20 |
 |
3.99 +0.14 |
3.49 +0.24 |
3.89 +0.30 |
4.15 +0.40 |
4.39 +0.40 |
4.75 +0.40 |
4.99 +0.34 |
 |
3.89 | 3.24 | 3.54 | 3.79 | 3.99 | 4.49 | 4.49 |
 |
3.99 | 3.49 +0.20 |
3.99 +0.40 |
4.49 +0.50 |
4.69 +0.40 |
4.85 +0.36 |
|
 |
3.89 | 3.34 | 3.69 | 3.99 | 4.19 | 4.29 | 4.49 |
| Bank of China | 3.45 | 2.89 | 3.09 | 3.29 | 3.65 | 3.99 | 4.19 |
| China Construction Bank | 3.25 | 3.25 | 3.59 | 3.79 | 3.99 | 4.29 | 4.39 |
| Co-operative Bank | 3.24 | 3.24 | 3.54 | 3.70 | 3.99 | 4.29 | 4.49 |
| Heartland Bank | 2.35 | 2.60 | 2.90 | ||||
| HSBC | 3.24 | 2.99 | 3.29 | 3.59 | 3.79 | 4.09 | 4.29 |
| ICBC | 2.99 | 2.89 | 3.19 | 3.29 | 3.49 | 3.89 | 4.09 |
 |
3.19 | 2.99 | 3.39 | 3.49 | 3.45 | 4.29 | 4.49 |
 |
3.14 | 3.14 | 3.44 | 3.65 | 3.89 | 4.24 | 4.44 |
Fixed mortgage rates
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67 Comments
Because the banks don't need the funding, they can still obtain funding through the RBNZ at the OCR
https://www.rbnz.govt.nz/monetary-policy/monetary-policy-tools/funding-…
Because they're taking everyone for a ride. I think they can afford to keep interest rates much closer to their term deposit rates for much longer than what the banks are saying. But they know in a high inflation environment, but with the OCR still at historic low levels they can get away with hiking mortgage rates and keeping savings rates as they are. It also points to a lack of competition in our banking sector, one would have thought the challenger banks would be putting forward top term deposit rates at the moment to take advantage of rising rates, but no they're not.
Of course, it could also be because the banks think the economy is going to really slow down next year putting downward pressure back on the OCR?! But I don't think anyone believes that.
It might but it's not like anything is going to take a nose-dive. I mean, how can it? Building costs aren't coming down and land costs could've decreased but with new avenues now open to home owners, it's not likey to nose-dive either.
Of course, they could be trying to bring the economy crashing down...
The amazing thing is their new 5 year rates are still the best rates I could get for a 1-2 year special when I first got a mortgage 12-13 years ago.
It's all relative. I still think the greatest outlier is that they have been so incredibly low for so long. We have been very lucky.
And 12-13 years ago prices were third of what they are now.
And if we take into account salary increases of 1% per year, how is it that people now can afford such high prices?
Does anyone has any savings for a rainy day anymore or they just believe that government will save them when they get into trouble?
The level of tinfoil hattery on this site is getting to extremes. Apparently stats nz are fudging the numbers (for political gain?). I get that some of you are angry about what you see as a system that's working against you, but can we leave the conspiracy theories to the anti-vax nutters please.
No, I didn't get a 3% rise every years for the last 10, due to just starting out in a new career path 10 years ago I've tripled my income in the last ten years, so I'm an extreme outlier for sure.
We had a thing at my old job where we would calculate how much we went backwards and adjust poop/mucking around times accordingly.
For example: Inflation 4.9%, pay"rise" 2%, so you were 2.9% worse off.
40 hours worked per week. That is 2400 minutes x 0.029 = 69.6 minutes more spend not working per week.
Employer think workers are so stupid, but the joke is really on them.
Yea it's probably a "poor attitude" but there is no loyalty these days.
The place I bought 13 years ago it actually worth 3.5x what I paid for it back then. I don't own it anymore but how a 2 bedroom unit on the outskirts of town can be valued at over 1m is beyond me. Auckland is broken.
To be fair my salary is 3x what it was when I bought that place. I had recently graduated from uni being the main reason why.
No such thing as savings. Revolving credit performs that function now...
The idea for most is that property values will appreciate over time, so if they end up selling in the future they will walk away with more cash in their pockets, however, if you are forced to sell shortly after purchasing, in most cases you can well end up out of pocket.
Very true, but you would be paying $250k more to buy a house from a year ago, unless you bought in a different area, hence why a lot of professionals are moving.
Sell for a massive profit in Auckland/Wellington, buy a place the same size or bigger at half the cost in Christchurch, and have a chunk of change to spend at Armstrong Prestige on a new car.
The downsides are you need to get a new job, move the kids out of school, wave goodbye to your neighbours and friends, and teach your new local barista your name and how you like your coffee.
Agreed. The attitude of some people on this site towards people who rent is appalling. It's like they really think renters are a lower class of human being, people who are not as 'smart' as property owners and are therefore all completely oblivious to obvious facts. Not the first time I've heard people on this site insult renters, or use 'renter' as an effective insult for that matter.
.
The attitude of some people on this site towards anyone who simply doesn't subscribe to their way of thinking is appalling. Some people seem to think that just because they borrowed a shite tonne of money, bought a house and then sold it for a tidy profit makes them some sort of financial investment super guru worthy of praise, and that anyone who doesn't prescribe to their investing brilliance is an idiot.
Jimmy and al123
The reality seems to get under your skin . . . rather than vulgar it is a reality which you don’t acknowledge.
The reality is that those who rent will not only be paying off the mortgage but the landlord walks away with the capital gain . . . nothing vulgar just the reality which you don’t seem to want to acknowledge.
Your responses supports my post . . . not only recognise it but an unwillingness to do so.
RBNZ data shows highest numbers of FHB over the past year moving into their own homes in past year now paying off their principal . . . . you won’t want to acknowledge that either.
Wow.
So FHB's with less than 20% are looking at least at a 4% one year mortgage rate.
This will rise to at least 4.5-5.0% by March.
Gee, hard times are a coming for the residential construction sector in Auckland, which has relied so heavily on FHBs in the last 3-4 years.
Rates heading back towards the long term average. Was going to happen sooner or later.
The cheap rates of recent time were an aberration. Bank stress tests are at 6% and DTI test now between 6 -7x your income, or the income generated. This will take the next 2-3 years to unfold as loans come off their fixed position (most loans). Anyone that leveraged up thinking the low interest propelled specuator train would go on for ever is, and was, wrong.
Are you not entertained?
Most banks assess a borrowers ability to afford a mortgage on the basis that the interest rate is 6%. And most of them have done this for some time now (past two years+ or so). So even these new higher rates are within that initial stress test. Forced sales or mortgage stress will only happen to borrowers who subsequently ran their affairs irresponsibly (like used their house as an ATM). The number of such borrowers will actually be very small. The main risk is economic. More paid on higher mortgage payments means less available for other spending in the economy.
Yes, whacks discretionary spending, more pain for hospo and retail. Especially combined with fuel and grocery bills rising a lot.
It will also whack housing construction - see demand shrivel, especially for FHBs, when mortgage rates are 6% rather than 3%, and the price of a 2 bed townhouse is 850-900k rather than 600- 650k (possible even 1 or 2 years ago)
Try stress testing at 8 or 9% that's a completely different story to 6%!
There will also be those who can in principle afford the mortgage, even at these higher rates, but don't like the lifestyle changes this entails. Such people might look to downsize or offload investment properties, especially if capital gains aren't as attractive as they once were.
It seems BNZ has already upped their rates.
https://www.bnz.co.nz/personal-banking/home-loans/compare-bnz-home-loan-rates?link=header
Classic (20% or more equity) rates for owner/occupiers are now:
- 6 months, 3.89%
- 12 months, 3.49%
- 18 months, 3.89%
- 2 years, 4.15%
- 3 years, 4.39%
- 5 years, 4.79%
I know when I renew our mortgage in January, that I'll be pushing them to keep the interest payments to no more than double what I'm paying now, but with as long a fixed term as possible, as they are only going to keep going up.
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