More fixed home loan rate changes are being announced, this time from ASB and HSBC.
And a feature of these changes is the steepening of their rate curves.
ASB has chosen to match ANZ and the others who changed earlier, for terms 1-3 years.
But they have supersized their increases for terms of 4 and 5 years, raising them by +90 bps.
ASB has had attractive four and five year offers, and this latest hike still leaves them below the equivalent ANZ carded offer levels. But ANZ has been a bit of an outlier for these rates with very high offer levels. For the second-largest home lender to push up towards ANZ at that end is a sign of inflation pessimism.
HSBC has also supersized their four and five year rate offers too, although the +70 bps rises in their case still leaves them with a good advantage over the main banks.
HSBC's one-to-three year card maintains a small discount from the main banks who have already moved.
Update: BNZ has now moved up as well. The table below has now been updated.
A feature of the BNZ move is that it has not adopted the steepening profile of ANZ, ASB or HSBC. It's profile is more like the Westpac one.
Further update: TSB has also rates fixed home loan rates. These are now in the table below as well.
At the same time ASB raised term deposit rates too. These changes take their six month rate up +15 bps to 3.75% and up +30 bps for one year to 4.50%, matching Kiwibank.
HSBC raised their six month TD rate to 3.65% and their 12 month rate to 4.30%.
BNZ has not yet announced any matching term deposit rate increases.
Overnight, global rates slipped lower in a changed direction.
One useful way to make sense of the 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 October 26, 2022 | % | % | % | % | % | % | % |
| ANZ | 6.05 | 5.99 | 6.09 | 6.19 | 6.29 | 7.19 | 7.29 |
 |
5.95 +0.45 |
5.99 +0.54 |
6.09 +0.44 |
6.19 +0.44 |
6.29 +0.34 |
6.99 +0.90 |
6.99 +0.90 |
 |
5.99 +0.50 |
5.99 +0.54 |
6.09 +0.50 |
6.09 +0.40 |
6.25 +0.36 |
6.29 |
6.29 |
 |
5.95 | 5.89 | 6.15 | 6.29 | 6.39 | 6.39 | |
 |
5.99 | 5.99 | 6.09 | 6.19 | 6.19 | 6.29 | 6.29 |
| Bank of China | 5.25 | 5.35 | 5.45 | 5.65 | 5.85 | 5.85 | |
| China Construction Bank | 5.50 | 5.65 | 5.65 | 5.95 | 5.95 | 6.85 | 6.85 |
| Co-operative Bank [*FHB special] | 5.35 | 5.25* | 5.65 | 5.75 | 5.95 | 6.09 | 6.09 |
| Heartland Bank | 5.09 | 5.45 | 5.49 | ||||
| HSBC | 5.79 +0.50 |
5.94 +0.55 |
6.04 +0.50 |
6.09 +0.50 |
6.19 +0.40 |
6.59 +0.70 |
6.69 +0.70 |
| ICBC | 5.35 | 5.25 | 5.35 | 5.45 | 5.69 | 5.89 | 5.99 |
 |
5.29 | 5.29 | 5.45 | 5.49 | 5.75 | 5.79 | 5.79 |
 |
5.25 |
5.19 | 5.99 +0.50 |
5.99 +0.40 |
6.09 +0.44 |
6.19 +0.44 |
6.19 +0.44 |
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25 Comments
Mortgage rates and OCR in NZ were around the same levels as today back in July 2014 but against a backdrop of an 0.8% annual CPI.
NZ's House Price Index, as per the Federal Reserve's international database, was reported at 140 pts back then vs 321 in the most recent report (129% higher than in 2014).
No wonder these rates don't seem normal: people were servicing much smaller mortgages at the same rates in 2014 and the price of everything else was barely moving.
But according to TA "Everyone has got their predictions for inflation and interest rates wrong"
It's kind of crazy that when given the option we don't choose the maximum term which gives people the most certainty, most people are making various bets on future interest rates with these massive mortgages, with the risk that the rates will go well beyond their ability to pay.
Compared to the US where from day one your know the interest rate for 30 years, so you really just carry employment risk.
I can't help feeling that this is gong to have severe repercussions for some people that will also reverberate throughout the economy. There's going to be a lot of belt tightening going on.
From 2.19% to 7% is spectacular.
I never got to enjoy the super low rate however the higher rates will push me back to technically running at a loss as I approach retirement
Fair enough - risky times holding debt at present, especially if you are close to retirement. We could be approaching one of those periods that happen every 80-100 years where holding debt turns out to be a disaster (and it always come after holding debt has been extremely lucrative - like what we have experienced so it catches people completely unaware - 'how could this possibly happen given what we've experienced in our lifetimes?').
Well I am certainly glad I reorganised things when I did. A year or two ago it seemed like it was a big mistake but not now. I tried to get a mix of incomes setup for when I am retired. Some will do better and some will do worse so hopefully things will even out and not be too bad.
I had my rates down around the 2.5% range. Cashed out my crypto earlier year and rang the bank telling them I was paying it all off at once. If I still had that loan at around 7% or so, I'd need a very good 6 figure income (pre-tax) just to pay the interest. Now its (mostly) in term deposits.
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