ASB, the bank with the second largest home loan portfolio, has had to cut its two year fixed rate back to match the cut that ANZ initiated earlier in the week. It has clearly decided not to match the BNZ cut to a lower 5.39%, down another -6 bp.
With this ASB retracement, that leaves Kiwibank as the main bank with the highest two year fixed rate offer. But among these main banks, Kiwibank has an especially attractive one year fixed rate, so they will probably focus on that. ASB also cut its one year rate, but not down to the Kiwibank level.
In addition to the main bank moves lower, there have been a few moves up and down by challenger banks this week. That has resulted in shifting positions for banks with the lowest fixed mortgage offers.
TSB is now the bank with the most competitive fixed rate mortgage card. It still has a 4.85% one year rate offer which is -40 bps lower than today's 'new' ASB offer.
And TSB is now the only bank with offers below 6% for fixed terms of four or five years.
Local wholesale rates are currently heavily influenced by the international bond market trends. They had been falling, but earlier today they started rising again in New York on better international trade data. So far the shifts are minor, but worth keeping an eye on.
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 July 8, 2022 | % | % | % | % | % | % | % |
| ANZ | 5.35 | 5.35 | 5.65 | 5.45 | 5.99 | 6.85 | 6.95 |
 |
5.35 | 5.25 -0.10 |
5.65 | 5.45 -0.35 |
5.99 | 6.85 | 6.95 |
 |
4.99 | 5.35 | 5.59 | 5.39 | 5.99 | 6.09 | 6.19 |
 |
5.45 | 5.19 | 5.69 | 5.89 | 6.05 | 6.29 | |
 |
5.35 | 5.35 | 5.59 | 5.45 | 5.99 | 6.29 | 6.39 |
| Bank of China | 4.99 | 5.39 | 5.49 | 5.80 | 6.05 | 6.15 | |
| China Construction Bank | 5.35 | 5.35 | 5.65 | 5.80 | 5.99 | 6.85 | 6.85 |
| Co-operative Bank [*FHB special] | 5.09 | 4.99* | 5.39 | 5.39 | 5.89 | 6.19 | 6.29 |
| Heartland Bank | 4.90 | 5.29 | 5.59 | ||||
| HSBC | 5.29 | 5.19 | 5.55 | 5.69 | 5.89 | 6.59 | 6.69 |
| ICBC | 4.99 | 4.99 | 5.39 | 5.49 | 5.89 | 6.09 | 6.19 |
 |
4.95 | 5.15 | 5.35 | 5.59 | 5.69 | 6.09 | 6.25 |
 |
4.85 | 4.85 | 5.35 | 5.35 | 5.65 | 5.89 | 5.99 |
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27 Comments
The markets and "non-independent" economists are flexing their political power and media muscles to downplay the inflation threat.
Modern economies run on consumers feeling confident enough about their future prospects to borrow large sums of money in order to buy stuff they otherwise can't afford.
It's a part of our history. Just look at what happened to the post-war generation, resulted in a combination of arrogance, a self entitled mentality and Dunning-Kruger effect. Instead of giving people a hand up these days, it's easier to just give them a hand out because it keeps the wage bill down, keeps people in rental properties and transfers wealth from the taxpayer to the landlord.
all the major banks are making Billions in profits and taking them offshore each year -- they can clearly afford not only these cuts but much deeper ones.
About time a government decided to seriously invest in Kiwibank - maybe use some of the huge current account balance or the massive increase in borrowing we have had for little outcomes - so they can really ramp up their volume by cutting rates significantly -- and keeping this money in New Zealand -- but no -- they even retained Westpac as their bank for most things when it was up for tender!!! really short sighted
KiwiBank is an absolute disgrace of a bank, I pitty and question the judgement of anyone using them as their primary.
They are also pretty woke, which could explain their implosion over the last few years.
Best thing a KiwiBank account holder could do is run a mile.
I want to defend Kiwibank so hard here - but you're probably right for most people.
We use it and love it - it 'just works' for us, at a lower cost than we were paying at the other banks (I've used 7 over the course of my life, just counted). It's hard to beat free. I wanted to say that the way we operate our finances, any of the other banks would work too - but then remembered why we left each of them - if you don't have a mortgage, the fees are horrendous.
My only hope is that should any banks require government support, Kiwibank would be the priority (and the Aussie banks would be told to take a hike).
sadly i agree -- Every time i have needed to refix for the last ten years i have approached them -- and not once have they even been competitive let alone market leading and the interaction has always been characterised by slow responses and poor communication.
So in the end i have never moved anything over despite a desire to do so -- That said it does not detract from the fact that if any government was serious about stopping the billions of $$$ in profits going offshore to Aussie - it would make a serious investment in the bank to allow it to be properly competitive
Or, just invest on the ASX and get your share of those profits. Anyone can. Also our Kiwisavers are all invested in them, so while I get the 'profits going offshore' argument, there is some nuance - what with all the wages they pay to NZer and the fact we can all invest in them, while we can't in Kiwibank!
It's amazing to reflect how quickly these have gone up. Part of our mortgage is coming up for re-fix next month, it was 1yr at 2.19, refixing now would be well over double the interest cost. It doesn't matter for us personally, we intentionally went short because the mortgage is almost done, but it seems like there will have to be a lot of people out there for whom this is going to be a very big nasty surprise.
This indicate that average population can only tolerate interest rate near around 5.5% or may be 6% (with Pain) and beyond that is disaster - sitruation that bank is trying to escape and is trying to avoid panic by not saying it loud in public.
Would like to hear the feedback, on the logic of dropping interest rate when it should be going up or being held is correct or any other reason besides business to tempt new buyers.
Yeah well Tegal just put their chicken up 10%. So guess how much your salad at Tank will cost in a few months.
Our dollar has slid a good ten percent so guess what happens when large importing companies work out their new standard costs & budgets for the year….
Inflation running at 8% in the US and Europe. Guess what happens to any products coming from there….
Best way to eat with a shit burger is quick.Pretending it’s all going to be ok will only prolong the agony.
On the flip side, economists often overstate the benefits of a weaker currency to exporters.
Given the complexities of global supply chains, some thinktanks have done the numbers on the top-traded goods in the world and have found a sizeable portion of production inputs (material, capital, energy, labour, etc.) are imported from overseas, so the higher costs of these imports eat into exporter margins.
High food commodity prices are boosting margins for our farmers, the benefits of a lower NZD are being offset mostly by high fuel and fertiliser costs.
The dominant narrative around an NZD being weaker as a good thing is hugely damaging and helps justify a low-rate environment. Slightly better returns for people sending our best food product overseas and leaving us to pay inflated prices for the scraps is not the game-changing argument some people think it is, and that's before you add in the cost of all the other things like more expensive fuel, clothing, electronics etc.
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