ASB is again leading the home loan interest rate market higher with across the board increases ranging from 16 basis points to 30 basis points.
The result is that ASB now has only one rate, their one year offer, under 4%.
And for fixed terms from six months to three years, ASB has the highest carded rates in the market. (ANZ's four and five year fixed rates are higher.)
In a hot and rising market, it appears ASB doesn't see any downside to having rate offers above everyone else.
No bank now offers any fixed rate below 4% for terms of four and five years.
The lowest six month rate is now available from China Construction Bank. Heartland Bank has the lowest for one, two and three year terms. And SBS Bank now offers the lowest for terms of four and five years.
Over the past week, wholesale swap rates have risen about +10 bps for terms of one, two and three years. So some upward movement has returned to these background markets that are key to pricing funds used for mortgages. Today, international benchmark rates rose again with the 10-year US Treasury up +5 bps, and it is likely this rising pressure will find its way into domestic wholesale markets.
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.
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 16, 2021 | % | % | % | % | % | % | % |
| ANZ | 4.00 | 3.45 | 3.85 | 4.15 | 4.45 | 5.24 | 5.54 |
 |
4.19 +0.20 |
3.65 +0.16 |
4.09 +0.20 |
4.35 +0.20 |
4.69 +0.30 |
4.95 +0.20 |
5.19 +0.20 |
 |
3.89 | 3.49 | 3.89 | 4.15 | 4.39 | 4.79 | 4.79 |
 |
3.99 | 3.49 | 4.15 | 4.49 | 4.69 | 4.85 | |
 |
3.99 | 3.54 | 3.89 | 4.19 | 4.49 | 4.59 | 4.75 |
| Bank of China | 3.49 | 3.29 | 3.49 | 3.79 | 4.09 | 4.39 | 4.69 |
| China Construction Bank | 3.25 | 3.25 | 3.59 | 3.99 | 4.25 | 4.55 | 4.69 |
| Co-operative Bank | 3.34 | 3.34 | 3.69 | 3.99 | 4.24 | 4.69 | 4.85 |
| Heartland Bank | 2.90 | 3.45 | 3.60 | ||||
| HSBC | 3.69 | 3.29 | 3.59 | 3.84 | 4.19 | 4.49 | 4.69 |
| ICBC | 3.59 | 3.19 | 3.59 | 3.85 | 4.19 | 4.39 | 4.69 |
 |
3.79 | 3.15 | 3.45 | 3.69 | 3.75 | 4.29 | 4.49 |
 |
3.29 | 3.29 | 3.64 | 3.94 | 4.19 | 4.54 | 4.70 |
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98 Comments
No one cares how much is the interest rates, people will still keep buying houses from each other. 4% to real estate agent everytime. If a house is sold 5 times which we kiwis do ( buy from each other). Real estate agent made 20% without adding any value.
And we wonder why house prices are increasing at this pace. The middle man (leeches) is spinning the market and spoiling it for everyone in the country. I wonder if these real estate have any dignity in themselves. Probably not.
The global market is pricing in a slowdown and a stalling or reduction of central bank interest rate rises. Fed, BoE, ECB all look likely to hold rates (or increase more slowly than expected). The banks know this, so they are squeezing some extra profit out of the upside, whilst their economists pump out opinion pieces about how scary rises in rates will expose borrowers on short-term deals. Disgusting really.
Spot on. Wholesale rates say the opposite - they are pricing in increased costs. As fixed rates are (largely) funded off wholesale rates, this is simply a margin restoration play, like every business is doing as it sees the cost inputs increase. I assume still some way to go if one was to compare yields now with when swaps were last this high...
And on 22 June 2020 Interestconz announced the following--what a shame so many missed out on going long as these rates survived into the Autumn of 2021:
ASB's new four year 'special' is now 3.09%. Their new five year rate is 3.19%. Neither of these reductions threaten the lower rates at both BNZ and Westpac who have them each at 2.99%.
Similar reductions have been applied to their equivalent standard rates.
At the same time, ASB has cut its term deposit offers hard, with reductions of -10 bps to up to -30 bps. In fact, their term deposit rate card is now the lowest of any main bank and their highest offer is now just 1.70% for five years. The popular 6 month TD term is now only 1.65% and the one year term is now only 1.60%. No other main bank is lower. And it is probably a sign of things to come from the other main banks. There seems to be no competitive penalty for very low term deposit offer levels. Banks generally have more funds flowing in that they have demand to lend them out.
The rates you have quoted from the ASB are all wrong. Rates are heading up and are almost back to where they were a year or so ago. Long term rates are rising significantly. This may only be the start, I'm expecting closer to 2% on my TD in February for short term investments.
We're on a 160k combined income with 250k deposit and yet the ASB won't lend us more than 700k. Now with this rising interest rate, we feel like we're locked out of the market forever. Never have I imagined a day where 1/4 of a million deposit with a good income won't allow us to buy a median price house.
Why didn't you buy sooner ? Many on here saw this coming a mile away when inflation went through the roof. To be fair $950K still gets you a house. The window of opportunity for FHB was the last 12 months . The door has now been shut and there are more rate increases to come.
This country is not for average Joe or Jane to live and have a life. My best suggestion I have been giving to others is to leave for better markets. NZ passport is very powerful, so easy to get better jobs and prospects around the world. You will get better respect, don't pay ridiculous house prices and good experience. And when you have earned enough, come back and live a lavish life.
Could be. I am on the process of refinancing and switching banks and it was brutal. We are in a significantly better position than two years ago and it was much easier back then. They complained about my expenses being too high. I was like WUT?
We don't have any other loans, no holidays, no eating out, no takeaways, no expensive hobbies, no fun basically. The only thing I do spend a bit more on is supermarket ($350 week for family of 4) and Netflix (basic) Sheesh.
I just let the mortgage broker deal with that, but I still got mad when he came back to me with them saying my expenses were too high. I was like, dude, do I have to start eating crappy food now? I've already cut almost all other enjoyment of life out. But get this, we asked for a loan of 400K, made up of 300K fixed term and 100k revolving credit (which will be paid in full, so no interest owing). We also have over 100k in cash/investments. I have a loan with another bank currently, term just under 26 years. I am paying $1020 fortnightly. ANZ approved the loan, but only just. When I wanted a term of 15 years they said no, because it was only approved for 30 years. The repayments on the 15 year term is about $1070 fortnightly, so only a little bit more than now, but my income has increased since I took out my first loan so I figured I'd put the extra money towards the loan.
I can't believe how ridiculous it all is, and apparently (according to the mortgage broker) it's going to get worse.
I have to argue against this. First home buyers should be looking at homes they'd be comfortable in for 30 years, or until the mortgage is paid off.
Because with house prices at an all time high, there's a risk prices could fall in the next few years, effectively wiping out their deposit, leaving them with negative equity, and their chances of trading up later may vanish. If things turn bad for the housing market, their best chance would be to "tough it out", as others have said, just to keep their first home.
I'm not saying look at 4 bedroom with pool type houses, I'm just warning against attempting to speculate on house prices, while it has worked in the past, it's gone hand in hand with rising house prices. If house prices stop going up, buying an apartment or flat with the intention of trading up later may be a bad idea. Save your money.
I have to disagree with you there.
Buying an apartment or flat means you are not paying rent to someone else for the next X years while you are trying to save a deposit. It gets you on the ladder so you can sell down the track, in the same market which you are trying to buy your' dream' home.
Trying to save for a deposit will only get harder as it's unlikely prices will fall substantially.
Option - Take your deposit, buy a rental. Pay it off as quick as you can and Be patient.
With that kind of money in the bank you have options. Remember that. Yes you are currently feeling a pinch but you have more income than average. And a bigger deposit than most. You have options.
Also We are not living in normal times. This is a global pandemic. Borders are shut this is affecting what people do with thier money.
The fundamentals won't be this buggered forever.
I know it sucks, but to be fair, seems prudent by ASB. 4.4x income. Under new CCCFA rules coming in to play banks must assess a borrowers ability to repay very closely. The days of borrowing 8+x income should rightly be gone.
The travesty is the house prices! In theory, supply of credit should impact asset prices bought on credit. But then again, no one wants prices to drop... #conundrum
I think it depends on people's own expectations. If people expect to buy a 2-3 bedroom house within Auckland, that would be difficult. However there are still plenty of condo/apartment options that are within that price range. The problem is, everyone wants a house and wants to pay the least amount to get it.
Unfortunately times have changed. Expectations need to be lower. And with the recent interest rate hikes, FHB will find it impossible to buy a home as the house prices will continue to go up, and mortgage interest rates and LVE will restrict them from buying and getting into the market.
Here is a discussion around the life expectancy of hunter-gathers. It's not complete and not fact checked but it is an interesting discussion.
Banks taking everyone for a ride. Global economic uncertainty means trouble ahead in 1 or 2 years from now. Why else are banks hiking mortgage rates without similar increases to term deposit rates? If we really were in a high interest rate cycle with a hot economy banks would be competing harder for our savings.
Why bother with the charade of competing in the Savings Pool if, by and large, savings aren't needed to create debt.
"But the RBNZ Banking License Ratios stipulate that there has to be an asset backing for all loans!" Sure they do. And what did the RBNZ do when 'things got tough'? Got tough on their ratios isn't the answer.
This is pretty curious. I had a 2 year 3.99% that I refixed to a very low rate this year. Now ASB have a 4.15% so we are right back to 2.5-3 years ago. Can house prices continue to hold with this increased pressure?
As I've said for years anything below the historic average of 5% is a good deal. For those who are buying you can only offer what you have available and you might be surprised that the bs does not always hold up to a real offer.
For those with a mortgage the percentage becomes less relevant the less you are borrowing. If there is room for extra payments they give a good return. Avoiding paying 4% interest is roughly the same as getting a 6% gross return on an investment, and every payment on a mortgage essentially gives you a compounding return.
"Can house prices continue to hold with this increased pressure?"
I think they will for a period of time simply due to the fact that 'we' are so far down the property rabbit hole, and so assured of the markets invincibility that the mantra will simply change from, "Rates aren't going up in the foreseeable future" to "Rates wont go up much further" or "Rates will peak and fall".
In the meantime people will keep piling in with a view that the party will continue, and they will be on the 'winning' side. Many will be "all in" but if the reality proves otherwise then the fallout will be severe for some.
I know its easy to speculate but surely when the stakes are as high as they are for many now, you HAVE to show some caution?
NZD is not a large player in the world if inflation is high say around 5% interest rates should be 7% at best, the banks know this bond market known this in the end people with bonds are loosing money each year the bond market is huge and will not put up with this for ever. Interest rates have to go up with if inflation and bonds move higher, so if you are hoping for lower interest rate you are dreaming.
Bring on 10% interest rates.... the boulders in the liquidity stream are hidden by the volume of cheap money. Make money worth something again and you will see rocks rising to the surface all over the world and a property investors scrambling for dry land and bleating all the way.
The rates wont be at that level for long as the economy will start slowing down and not being productive so they will have to start dropping them again ,plus the RBNZ is still printing a shit load of fake Fiat dollars to keep propping up the biggest Ponzi Scheme in history. As Ive been saying for the last 2 years buy assets that produce an income and you shall benefit by the end of this decade.
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