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BNZ the latest bank to cut fixed mortgage rates, offering the lowest 18 month fixed rate of any main bank and equal low for other popular terms. Heartland Bank, Kiwibank cut too

Personal Finance / analysis
BNZ the latest bank to cut fixed mortgage rates, offering the lowest 18 month fixed rate of any main bank and equal low for other popular terms. Heartland Bank, Kiwibank cut too
[updated]

Another major bank has cut home loan rates. Update: Now Kiwibank has announced lower rates.

And a set of challenger banks are in the action too.

We have had rate changes (all cuts) from BNZ, Bank of China, and Heartland Bank Friday. These follow Westpac, ANZ, and the Cooperative Bank earlier in the week.

This jockeying changes where relative positions of the main mortgage lenders have landed in their carded offers.

We still have rate changes to come from two majors, ASB and Kiwibank. And TSB, SBS Bank, and others are yet to move down too.

At this point in the current cycle of rate-cutting, the lowest rate from any bank is by SBS Bank with their 6.19% four and five year carded rates.

For the increasingly popular six month fixed, it is BNZ displaying the lowest carded rate at 7.05% the same as offered by ANZ, Westpac, Bank of China and the Cooperative Bank.

The cuts by BNZ today position it also the lowest among the main banks for a fixed term of 18 months, and equal with many of their main rivals for terms of 1, 2, 3, 4 and 5 year rates.

Update: Kiwibank announced changes that become effective on Monday. Basically they match their rivals.

But it is Heartland Bank's -20 basis points (bps) cut that gives it the lowest position of any bank for all the terms they offer; 12, 18, 24 and 36 months fixed.

Having noted that, we should also note that Heartland Bank's offer is online only. As such, there is no wiggle-room for negotiation with them. And brokers don't get paid by Heartland so there is no incentive for them to offer you these rates. You would have to go direct via their online process.

But almost all other banks will have some flexibility in their rate offers. So the carded rates are just the start. Negotiate. How flexible they may be will depend on the strength of your financials. And don't forget, banks have savvy tools at hand to 'know' the likely valuation of your property, so if the loan-to-value ratio (LVR) is near 80% you may not find them very accommodating for a lower rate. With falling house prices, the point where low equity premiums start applying is shifting around as well. Beware.

And the carded rates we report here can be different to the rates banks might offer in their banking app. We would like readers to reveal what their banking app shows as the potential offer rates. Please add that market intelligence in the comment section below.

A quick check of the wholesale swap rate chart below gives a clear understanding of where funding costs are heading.

Even though the Reserve Bank has not actually cut official rates yet, the market is doing that "for them". Words and signals matter in financial markets.

Finally, we should note that both BNZ and Heartland Bank made compensating reductions in their term deposit offers today too.

One useful way to make sense of the changed home loan rates is to use our full-function mortgage calculator which is 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. Break fees will be minimal in a rising market. But they become important in a falling market.

Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at the moment. Updated with Kiwibank changes effective Monday.

Fixed, below 80% LVR 6 mths   1 yr   18 mth  2 yrs   3 yrs  4 yrs  5 yrs 
as at July 19, 2024 % % % % % % %
               
ANZ 7.05 6.85 6.69 6.49 6.35 7.14 7.14
ASB 7.24 7.14 6.89 6.75 6.39 6.39 6.39
7.05
-0.19
6.85
-0.29
6.65
-0.24
6.49
-0.30
6.39
-0.26
6.39
-0.25
6.39
-0.16
Kiwibank 7.05
-0.20
6.85
-0.14
  6.49
-0.30
6.39
-0.26
6.39
-0.26
6.39
-0.26
Westpac 7.05 6.89 6.79 6.75 6.39 6.39 6.39
               
Bank of China  7.05
-0.04
6.85
-0.06
6.75 6.49
-0.16
6.29
-0.20
6.29
-0.10
6.29
-0.10
China Construction Bank 7.19 7.09 6.89 6.75 6.49 6.40 6.40
Co-operative Bank 7.05
-0.18
6.79
-0.20
6.69
-0.20
6.49
-0.30
6.35
-0.30
6.35
-0.20
6.35
-0.20
Heartland Bank   6.69
-0.20
6.49
-0.20
6.35
-0.20
6.15
-0.20
   
ICBC  7.19 7.05 6.79 6.69 6.59 6.49 6.49
  SBS Bank 7.24 7.14 6.89 6.49 6.35 6.19 6.19
  7.39 6.99 7.19 6.75 6.65 6.59 6.59

Fixed mortgage rates

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Daily swap rates

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Source: NZFMA
Source: NZFMA
Source: NZFMA
Source: NZFMA
Source: NZFMA
Source: NZFMA
Source: NZFMA

Comprehensive Mortgage Calculator

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87 Comments

Come on banks, don't flog a dead horse

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4

Dream on.

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5

Has any of this flowed through to app offers yet? Or are they just reducing carded offers with no actual change to the real rates you could already get?

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No change for me yet

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0

So anyone rolling here is most likely to fix for 6 months looking at the curve, and is still paying 7% which is not really going to take much pressure off NZers, with no CPI data until Oct.    Retail may have a bad xmas, I see Briscoes doing 50% off the store this weekend....

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5

Briscoes do 50% off every week 

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9

50% Off at Briscoes?! You mean they are going to reduce their prices back to just normal, full retail price... (NB: Farmers do the same, so do pretty much all the other boxstore retails)

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4

Bloody Briscoes mark up prices 200% so 50% is normal price.

I've never been there when there isn't a sale....

But i agree, this Xmas is not looking good for retailers.

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3

Worked there over a decade ago. When the GFC hit, and spending was down the drain, they marked up all their prices by 20% then started having 60% off sales. More people came in than before, and more profit with it. 

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Exactly. This is all marginal stuff

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Nobody here should be bad-mouthing 🤬 the much-admired retail giant, Briscoes……

In fact, some propose that RBNZ replace the Queen 👸 with the Briscoes lady 👩🏻‍⚕️ on our 20 dollar banknote. 💵

Real class. ✔️🤩

TTP

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4

I'd rather have the briscoes lady on our bills than old Charlie....

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3

Tim Mordaunt or the Briscoes Lady? 

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3

she looks a bit like Jacinda when she was young, might as well have Jacinda on our $50, and Judith Collins on $10.. Trifecta!

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4

Been in a couple of malls recently, most of the stores seem really quiet

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0

We sell to retailers, April was good, ahead of last fy, since then it's been a bit of a blood bath. Budgeting for 20% down on last year now. Won't make a $ this year on current trends.

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I had to go today. After reading your comment I thought it would be nice and quiet, but unfortunately it was heaving, hard to get a park. 

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2

Last weekday of school holidays

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1

What I am noticing is that the malls are still busy but the shops are quiet. I know that sounds counterintuitive but I think quite a few people like to go to malls just to walk around and get a bite to eat. And then go to the supermarket 

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Remember your Bank is not your friend. Never have been, never will be. 

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21

Actually my bank was my friend, sure I paid interest but without a loan I would have not got into a house in the first place so it was a win win.

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6

Oh-no, I just threw up in my mouth....

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10

I guess your bank manager must have put something in your mouth. Guess I was lucky only had to sign a bit of paper to get my loan.

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5

"put something in my mouth" - LOL!,

Zwifter, I know THAT never happened! 

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Without banks to loan people money, houses would simply cost less.

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14

There'd also be a larger proportion made out of canvas.

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10

The result would be less people owning houses

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2

Actually, Josef Fritzl was my friend, sure he kept me in dungeon and violated me on the odd occasion, but without him I wouldn't have been served porridge through the flap on my door so it was a win win.

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17

Spat out my coffee reading this. Classic. 😂 

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No it was a business relationship. The interest you paid them contributed to a number of bank employee bonuses. They only saw you as a means of attaining an income.

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Zwifter's convinced he has a friend. Best we not ruin the relationship. 

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I know the escort I hired truly loved me.

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😆🤣

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I'd never mix friends with business. 

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Like a rate cut without actually cutting rates.

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Rates have been cut, you just need to call them for a better rate than what’s advertised.

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3

Not long now before we see a mortgage rate starting with a 5.

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5

I think it will stay in the 6's for a long time.

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What's a long time? I expect we'll be in the 5s by February. 

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3

Heartland is at 6.15% already, barely a squeak away from 5.99%

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6

I only look at the top 4 banks, if you want to go with a minor bank then sure.

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Money is money -  there is no difference in the money that comes from a particular bank you borrow it from, so might as well take the cheapest one.

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6

Talk to anyone that banked with HSBC and ended up with pepper money and see if they agree with you. 

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Anyone who borrowed money from HSBC was fine.

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Not so I know of someone who was screwed over by the sale to pepper money. It is wrong that you can get a loan from a bank and then end up with a non bank lender. 

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4

I was one of those. Pepper money was fine as everything was kept the same and moved on from them really easily just recently. HSBC was terrible in respect to getting your loan docs and only good thing with them was sharper pricing. But you should be switching banks every 3 yrs as long as the cashback justifies it.

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That only really matters when you are depositing.  If borrowing, who really cares, if the bank goes under somebody buys your debt and you just have a change of who you have to make payments too. 

If you are a depositor, until the gaurantee scheme kicks in (mid next year?) then if the bank goes under you might lose it all.

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Keep digging Zwifty

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Probably not until April 2025

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2

No change to the rates offered on the BNZ app as of yet

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0

What are they offering on the BNZ app please?

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Currently,

 

6.95 6 month

6.85 1 year

6.55 18 month

6.49 2 year

 

Still no changes have gone through on app

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1

ASB app is showing 6.72 for 12 months and 6.62 for 18 months.  The 6 month is the same as above.

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Hi, how do I see ASB interest rates in the App? 
I came off fixed yesterday but can not see any fixed rates. I’m looking for the six month 6.95% 

not sure I’m clicking on the correct part in the App to show what rates are on offer 

Thank you 

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Hi, I go into the mortgage account, select 'more options' then select Home loan rate fix and they all come up.

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1

Had a fixed rate come off a week ago with BNZ and sat on floating for 5 days. Just locked in. My my rough maths I saved a few hundred $, after allowing for a week at higher rates. 

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What rate did you get?

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Good work m8.

 

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Big gap between floating and fixed now.

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Arbitrage btw banks competing with each other for uptake of mortgagees mortgages coming to an end of their term.

Higher for Longer baby 👶 

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How high & how long…? Come on…give us a prediction to back up the repeated claim 😉

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2

Post Trump POTUS election. 😉

J.Powell. You're Fired!!🤭🤔😲😂

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1

Ahh ASB. early to rise, late to cut. Always and forever...

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4

ANZ sure don’t want anyone fixing for longer than 3 years. 

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Part of the PR campaign along with the inflation cuts will come soon stories to try and breath some life back into the flagging housing market. 

 

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5

Classic moronic DGM take.

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6

Should encourage a few bets on the property market. 

Smart people will have been buying in the last 18 months. 

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1

To my knowledge the actual rates haven’t changed, just the advertised ones. I could get a better 6 month rate 4 weeks ago than I can now!

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1

And so it begins....

I posted here last week that a house up the road had been listed, joining the mass of other listings in the area.  The pre-open home crowd had been through, and obviously passed it by, and then last weekend the "For Sale!" sign went up, for the less informed masses.

Today. It's "Sold!"

I wonder why? It couldn't be anything to do with expectations of more, cheaper Debt going forward, could it? Perhaps it was one of those pre-inspection people who thought they'd "better get in now before everyone else does"? Nah. Neither of those. Just pure coincidence...( What did I write JFoe? "It won't be 12-18 months before the Property Ponzi fires back into life if we get cheaper Debt Rates. It will be weeks, maybe days" and so it is).

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3

"One swallow does not a summer make".

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5

It does, actually. It just depends on when the rest of the flight arrives. And let me give you a clue - they are on the way. Can't you hear the flapping of cheap Debt wings?

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A European swallow because African swallows are non-migratory. 

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1

One sale as a basis for such a big call?

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5

It is a bold call…but if sentiment changes & you are a potential buyer waiting for the “bottom” you’d have to start thinking it’s close & might take the leap & buy maybe? 

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Honestly i've been seeing houses selling quite quickly, the good ones anyway, for a few months now.

house next door to me took 3 weeks to be sold.

personally i think the general public doesn't have the same view as people here, they saw how hard it was to get a place in 2021/2022 and see now as a discount and more affordable, and that interest rates are on their way down. i know 2 people in my circle who have bought recently.

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It's not the selling that's the hard part, it's the price. If the vendor is willing they'll find a buyer at whatever price the buyer offers. I don't doubt the sales anecdata people are bringing forward, but I'll reserve judgement on market direction until knowing transaction values.

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5

ASB banking app

Currently 

6mnth 6.95

12mnth 6.72

18mnth 6.62

24mnth 6.49

 

 

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2

how many people use a mortgage broker to re finance?

MY colleague said his broker offered him 6.65% for 6 months at ANZ.

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Mortgage brokers will not get you better rates than you would get calling and pushing for their best rates. 

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4

"his broker offered him 6.65% for 6 months at ANZ"

Thanks for that info, very valuable.

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1

Any interest rate starting in either 6 or 7 is high, hurting and will have dire consequences for a couple of years at least

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Funny how slow they are when the OCR is increased. But the OCR hasn't even dropped yet. They are going to look a but stupid if the OCR doesn't drop later in the year. There is a still a lot of inflation occurring

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There is a still a lot of inflation occurring

------------------

Where?

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6

Anyone here who thinks property is a lousy bet needs to read this. Just out 4 days ago. And the chart won't include rent. Psychics are few and far between, but the past is probably a pretty good predictor of the future. 

https://www.opespartners.co.nz/investment/property-investment/chance-i-…

 

 

 

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3

Oh...the paragon of independant property comment.

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Que the breathless spruiking from property pundits pushing FOMO.

The RBNZ better adjust LVRs and DTIs when they cut the OCR. If they don't - once again I'll be saying they're asleep at the wheel.

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"Que" ?

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