Less than 10 days after previously cutting its fixed home loan rates, ASB is back with more reductions.
And they are cutting term deposit rates too, blaming "wholesale rates".
But that seems a little disingenuous because wholesale rates have in fact moved very little.
But what is happening is ASB is releasing its half yearly results today (Wednesday). And we are less than a week away from the next Reserve Bank Monetary Policy Statement and Official Cash Rate review.
ASB's new lower home loan rates mean they now have the lowest rate set for all the 6, 12, 18 and 24 month fixed terms.
Their new six month rate is 5.89%. This is the lowest of any bank.
Their new one year rate is now 5.49%, also a market low, but they share that rate with Heartland Bank.
Their new eighteen month fixed rate is 5.19%, and easily the lowest level of any bank.
Their two year rate has fallen to 5.29%, a level they share with most other main banks.
None of these rates are as low as Westpac's 4.99% three year fixed offer however.
ASB claims "falling wholesale rates" are behind these move and their term deposit rate cuts.
And the TD rate cuts are sharper than the mortgage rate cuts, essentially -20 bps for both the 6 and 12 month terms.
But on February 3, when they last cut rates, the one year swap rate was 3.51% and the two year 3.44%. Today these two rates open at 3.48% and 3.44%. These net moves hardly justify using wholesale rates as a reason for ASB's adjustments.
More likely, it is competitive pressure in a misfiring housing market that is driving them.
The reader-reported mortgage rates are fluid but may be less frequent now, so please record them if you have them. We need you to record them in the comment section below, which helps us stay on top of this fast-changing corner of the home loan rates market.
And still negotiate. How flexible they may be will depend on the strength of your financials.
One useful way to make sense of the changed home loan rates is to use our full-function mortgage calculator which is below.
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, like now.
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 February 12, 2025 | % | % | % | % | % | % | % |
| ANZ | 5.99 | 5.57 | 5.39 | 5.44 | 5.59 | 6.19 | 6.19 |
| current reader-reported rates | 5.85 | 5.49 | 5.35 | 5.29 | 5.55 | 5.59 | 5.59 |
 |
5.89 -0.10 |
5.49 -0.05 |
5.19 -0.15 |
5.29 | 5.59 | 5.79 | 5.79 |
| current reader-reported rates | 5.85 | 5.49 | 5.12 | 5.17 | 5.29 | 5.69 | 5.69 |
 |
5.99 | 5.55 | 5.39 | 5.29 | 5.59 | 5.69 | 5.79 |
| current reader-reported rates | 5.85 | 5.49 | 5.35 | 5.09 | 5.35 | 5.45 | 5.59 |
 |
5.99 | 5.55 | 5.29 | 5.59 | 5.79 | 5.89 | |
| current reader-reported rates | 5.99 | 5.55 | 5.29 | 5.59 | 5.79 | 5.89 | |
 |
5.99 | 5.54 | 5.34 | 5.29 | 4.99 | 5.49 | 5.59 |
| current reader-reported rates | |||||||
| Bank of China | 5.95 | 5.55 | 5.35 | 5.39 | 5.49 | 5.49 | 5.49 |
| China Construction Bank | 5.99 | 5.57 | 5.39 | 5.44 | 5.59 | 6.40 | 6.40 |
| Co-operative Bank (*=FHB only) | 5.99 | 5.49* | 5.49 | 5.49 | 5.69 | 5.79 | 5.79 |
| Heartland Bank | 5.49 | 5.39 | 5.39 | 5.45 | |||
| ICBC | 5.99 | 5.55 | 5.39 | 5.59 | 5.59 | 5.59 | 5.59 |
 |
6.09 | 5.69 | 5.49 | 5.49 | 5.59 | 5.79 | 5.79 |
 |
5.99 | 5.59 | 5.59 | 5.45 | 5.59 | 5.79 | 5.89 |
Fixed mortgage rates
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86 Comments
Negative "growth" of 130k in a month: https://www.interest.co.nz/property/131763/prices-down-and-stock-levels…
Stock overflowing.
Inflation control stalling.
Immigration stalling.
Economy stalling.
Oh dear.
I am still of the opinion that the lower OCR will create GDP growth, and this will encourage immigration and less emigration.
I can't see any proof of "Inflation control stalling" in NZ.
Anything could happen from here, but a return to growth in GDP and eventually house prices seems to be the most likely IMO. I doubt either will be at particularly high levels.
Everybody on here seems to think NZ is in some sort of vacuum.
If the FED stops dropping we stop or we debase the NZD considerably reintroducing a lot of tradable inflation - which is likely to go up anyway due to trade wars.
Oh look:
https://www.cnbc.com/2025/02/11/fed-chair-powell-says-central-bank-does…
The FED rate cuts have effectively ended short of some economic catastrophie.
Average sales price is not the same as average price, an astute investor would surely understand this.
Interest rates getting lower every week.
More buyers coming to the market.
Work visas near record highs, more rentoids.
More stimulation coming to the economy.
You will look back to 2025 and say, "Oh dear, i wish i took the chance when i could"
Average sales price is not the same as average price, an astute investor would surely understand this. - You have one property, you are not an investor let alone an astute one.
Interest rates getting lower every week. With evidence above that this will stall shortly.
More buyers coming to the market. Did you hear that one from an agent? Must be true.
Work visas near record highs, more rentoids. Oh really? Stats NZ shows departures up, immigration down, net going towards or close to nil.
More stimulation coming to the economy. Did you hear this one from an agent too because it certainly sounds like it came from somebody who doesn't have a clue.
You will look back to 2025 and say, "Oh dear, i wish i took the chance when i could" - I will look back at 2025 saying: "I hope Rookie is ok"
:D
I am an Investor, you don't know. Like many other things.
With evidence above that this will stall shortly.
Where?
Did you hear that one from an agent? Must be true.
Actually that's from the article you linked.
Oh really? Stats NZ shows departures up, immigration down, net going towards or close to nil.
Net immigration was 30,000.
Did you hear this one from an agent too because it certainly sounds like it came from somebody who doesn't have a clue.
OCR coming down = more stimulation, possibly even to 3% and 3.5% minimum.
I will look back at 2025 saying: "I hope Rookie is ok"
If you are thinking about me in a years time, maybe you should be charging me rent?
- A few weeks ago you said you scraped enough together and bought your first property in 2022. If you bought an investment at the same time I understand the desperation in your comments - you are drowning in debt.
- The evidence is that the FED has stopped dropping and we are clearly nearing the end of the interest rate cycle. If you could link the two together you'd understand.
- Please link the article - a general comment of "more buyers are coming to the market" is meaningless nothingness unless there is a considerable shift which I want to see proof of
- Net immigration was 30k as of Nov 2024 (still falling) compared to 133k last year. Where are these record numbers you keep mentioning?
And we may go negative https://www.rnz.co.nz/news/top/540471/nz-could-become-net-exporter-of-p…
- Most of the rate drops have been priced in. The 50bps this month may be the last of it for reasons stated above. A neutral OCR rate will not be the fire that starts up an economy, we require government stimulus to get out of this.
The way you are going you may become a "rentoid" soon.
Finally, take a hint from everybody else, you are embarassing yourself as usual.
3 likes in a few minutes, you get 3 like on all your posts instantly, would be very sad to think you have 3 accounts just for that.....
Nope, wrong, i have 1 property, you realize you can invest in things other than property right?
Please link the article
Sales also pushed higher, with 700 sales becoming unconditional in January, the highest number for the month since 2022.
And we may go negative
"May". that's means its possible, currently we are not.
It's quite clear your only REAL argument is to insult.
He gets likes from people like me.
Last time I talked about non-property investments I believe you tried to dogpile me for holding NVIDIA… or was that another spruiker who knows.
Glad to see that the economic incentives are driving more MITHs to stocks, bonds and other investments.
SKF
NVDA, TEAM, AMZN are my AI play currently. I only invest in what I know, and that’s mostly tech. NVDA has good long term but subject to temporary volatility as it’s held so widely, as bond markets reprice for higher rates fund managers are wanting to take profit from NVDA and reallocate a larger portion of their portfolio to bonds. As inflation flattens or rises NVDA will fall because of this. I might trim my position if it breaks 145 again to pay for a tax bill.
SKF
3 likes in a few minutes, you get 3 like on all your posts instantly, would be very sad to think you have 3 accounts just for that.....
- Yeah, I have 38 accounts to like my own posts just like in the article you linked: https://www.interest.co.nz/property/131763/prices-down-and-stock-levels-rising-2025-gets-underway-barfoot-thompson. Today I was a bit lazy so I only upvoted myself 6 times.
I felt so bad that you have 0 that I upvoted you myself:
Nope, wrong, i have 1 property, you realize you can invest in things other than property right?
- Clearly the implication was that this is about property investment. Again you get caught out and change the story.
Sales also pushed higher, with 700 sales becoming unconditional in January, the highest number for the month since 2022.
- Oh I'm going to go for the Rookie special here - "An increase in the number of sales doesn't mean that more buyers are coming to the market"
"May". that's means its possible, currently we are not.
- May like "There may be rain in the next few days" rather than "Rookie may start posting intelligent comments going forward"
It's quite clear your only REAL argument is to insult.
- Not really but you just make it too easy though it does sometimes feel like I'm punching a toddler.
I feel like property attracts so many more people like this because they attach a utility value to being able to, literally, lord over others.
Edit: this is in the context of investing in 2022 to today.
You could have seen +57% return if you just bought SPY or VOO (S&P500) or you could have seen +157% return if you just lazily bought the 3x leverage ETF of it (SPXL) or double that (+300%) if you bought SPXL it on margin leveraging 2:1, which would give you a net leverage of about 6x (basically the same as housing leverage).
Im sure the rookie investor is enjoying his 100k that is now 400k because of his astute investment choice, oh wait it’s in the name! A rookie.
But none of that matters when you buy property because to these people you become a lord, and that means you’re better than everyone else, and that is definitely worth the 300,000+ difference in wealth to them.
SKF
Remember what you said yesterday.
by RookieInvestor | 11th Feb 25, 9:01am
If i were buying a property now i would still be allowing room in the budget for 9-10% interest rates as a fall back.
Rookie, you should be hoping for another pandemic or crisis, something that creates a fear trade into the bond market and drives interest rates lower. That would also give governments a reason to print more money, which pushes asset prices up. But right now, the situation is the complete opposite. Its an environment for higher rates.
Yes, that’s correct. Depending on the crisis, it could be QE infinity and asset holders would do well. But right now, I’m not seeing another crisis and the narative is the US economyis strong. In a US stock market crash, we could see money move from equities to bonds. Not sure how much rates would drop, that depends on the feds actions, if they choose rescue by printing.
I cheer for a strong US economy and a stable stock market because it means HFL. You should want the US to have a crisis and the fed come to the rescue.
The reader-reported mortgage rates are fluid but may be less frequent now, so please record them if you have them. We need you to record them in the comment section below, which helps us stay on top of this fast-changing corner of the home loan rates market.
Good luck, you're about to start charging people to provide you with this info.
For sure. Recognizing the emptiness in a lot of my own recent posts, I'm still debating whether I sign up again.
I like Interest, and I signed up to get the newsletters and green tick. But... it turned out I had to be a different class of subscriber for the "articles straight to your mailbox", so that was a little disappointing.
Then there was a period mid-last year where a certain member became very aggressive, denouncing any and all who's views opposed their own as stupid, even going so far as to preemptively judge any who would dare to comment. I cancelled my subscription at that point.
I will probably keep reading for a while, but there has seemed to be a shift from neutral in recent times (articles are peppered with opinions on the news, rather than just the news), that has been very off-putting, and I'm wondering if maybe I should stop reading this rag from an obviously very sick country (the rest of the world's sickness notwithstanding).
"Temped to float " - do the maths. How much does the rate need to drop to make the decision to float make sense? For a $450K mortgage choosing to float will cost the best part of $200pw. So, float for a month and the rate has to drop by about 20bps to make your decision worthwhile. In the meantime you could be paying that extra off your mortgage & get the benefits of that in the long term by reduced compound interest. Signs are there we may not see lower or much lower rates than what we are currently seeing this cycle - plus rates are below long term averages. Global uncertainty means its not impossible rates start to climb. Personally I'd lock in as low as I can for as long as I can ATM. Negotiate to get your bank to match Westpac's 4.99 for 3 years. You can also hedge your bets by only locking in part of the mortgage and choose a different strategy for the rest.
Good job Prag! The temptation was to call your fellow humans in this society doom gloom merchants over something as trivial a small movement in interest rates but you did not. A pleasant development in the way we treat each other. Nice work 👍
As it says in the bible we shall be judged by how we judge. You not judging or labelling others (doom gloom merchants) means they will not judge you for your judgement - and thus we move away from division and discord with one another. A positive step in the right direction.
I’m thinking the NZ2Y has resistance at 3.6%, just like the US2Y, UK2Y, and AU2Y. Trump tariffs, deficits, and doge cutting government spending, plus more QT from central banks shrinking their balance sheets, mean higher rates and less liquidity, not a great environment for real estate. Add in rising commodity prices from blanket tariffs, higher energy costs, and rising unemployment. I don’t think commercial banks trimming term deposits will mean anything more than a couple of basis points.
Well, well, well David, I recall your article of January where you explained at length why interest rates won't drop by much anymore. I replied "this article won't age well". You can look at wholesale rates, inflation, tariffs, exchange rates etc all you want, the overriding force is that banks need to write new mortgages, that's what truly matters.
3 year swap is 3.5%, so 1.49% between that and Westpacs 4.99% 3yr rates.
Seems like a reasonable margin for them.
Edit: reference to prove my point.
https://www.interest.co.nz/banking/131845/asb-posts-profit-increase-des…
There’s room for the OCR to be cut by 50bps, and commercial banks still have operating margin. Enjoy it while it lasts, though, because I don’t think the NZY2 will drop below 3.6%. You mentioned yesterday that you would factor in a 9-10% mortgage rate for any new property purchase, you are as bearish as I am.
I believe you, you are open to the possibility of higher rates but think they will go lower.
This could go either way depending on what central banks decide and whether they want to debase their currencies. But with Buffett sitting on cash, it makes me think rates are going higher until he can pick up some discounted assets.
SP500 isn't going higher with US10Y above 4.5%
ANZ report out today says 50bps, but caution after that ie data watch mode.
RBNZ MPS Preview: the downward march continues
-
We expect a 50bp cut in the OCR to 3.75% next Wednesday. That would be consistent with RBNZ November messaging, economists’ forecasts, and market pricing. Data since the November Monetary Policy Review has been mixed, but overall consistent with the RBNZ’s guidance.
-
With the OCR now much closer to neutral and the economy showing clear signs of life, we expect more caution from the RBNZ from here – this is likely the last 50bp cut. However, given the RBNZ’s central estimate of neutral is 3%, the risks are tilted towards a lower OCR trough than the 3.5% we are forecasting.
I think we will look back from 2026 and think Orr was too slow to cut when he could (ie pre trump).
Even after the expected 50bps, he still has a restrictive setting.... It tells you how worried they are about inflation,
or alternately tells you they misjudged trumps impact on inflation expectations.
not much lightness and joy from Tony...
Tony Alexander: 4.99% mortgage rate surprise - should Kiwis hold out for a better deal?
Banks are competing hard for new customers.
Tony Alexander12 Feb 2025
Westpac has dropped its three-year rate to 4.99%. Will it be the low this cycle? Photo / Doug Sherring
ANALYSIS: The introduction by a major bank of a 4.99% three-year fixed mortgage rate seems consistent with a general improvement in competition between the banks for mortgage business which I have picked up in the monthly broker survey I run with mortgages.co.nz.
Would 4.99% be enough to encourage me away from fixing one year or less if I had a mortgage to manage at the moment? Yes. I am concerned about underlying inflationary pressures in the economy and see limited scope for interest rate falls after next week’s 0.5% or 0.25% cut from the Reserve Bank.
Excluding the silly 2019 to early 2022 period, the 4.99% rate has been bettered in only 19 of the 336 non-deflation/pandemic months since the three-year option appeared in late 1993.
Will 4.99% be the low this cycle? Maybe not – but it doesn’t feel too far away from whatever it will be.
On the economic side of things, it is good to see that the Government has a pro-growth agenda and is introducing and considering policies which may make some contribution towards improving New Zealand’s increasingly weak economic performance. Will the policies announced and in planning make much difference? No.
It wasn’t until the early to mid-1990s that the reformist policies from 1984 had their greatest impact. So, the first thing to recognise is that changing the playing field and improving incentives for effort and innovation take a long time to deliver any meaningful payoff.
The second thing to note is that we have not now just embarked on a reform period bearing any resemblance to that of 1984-92. The changes are minor and appear driven by a belief that there are thousands of people and billions of dollars eager to get into our country but some simple-to-remove barriers stand in their way. No there aren’t.
We are a very small country with high costs well removed from global trade routes. We rely on a limited range of largely commodity-based exports with some very nice IT frills and a lowly productive tourism sector. We have a record of closed-then-open-then-closed doors to foreign investment and a strong opposition party replete with those who will wind back deregulatory policies once returned to power.
There is not a popular mandate for substantial change to be introduced to our economy or the role of government in it, and we do not have conditions or cultures which would deliver success by replicating policies used in some other countries such as Ireland or Singapore.
Independent economist Tony Alexander: "Changing the playing field and improving incentives for effort and innovation take a long time to deliver any meaningful payoff." Photo / Fiona Goodall
Therefore, when it comes to the general focus maintained in this column, my presentations and various writings, there seems no need to alter the outlook I have for the next one to three years regarding housing, interest rates, and our likely pace of economic growth.
Or, to put it another way, I fail to see anything realistically coming along which will make young Kiwis stop and think twice before hopping across to the multitude of opportunities and higher incomes available in Australia. Frankly, more may be encouraged to go if they think the door may be opened a bit more to foreign buying of houses, no matter the price range because such things have trickle-down effects on lower price brackets.
Having said all of that, it still seems reasonable to expect that as we progress through 2025 and especially into 2026 the economy will become healthier. There will be assistance to growth from lower average interest rates, better dairy sector incomes, more infrastructure spending, a focus by businesses on raising productivity levels (hopefully), and a slightly lower NZ dollar.
But it would be foolish to ignore the risks for our small trading nation from the developing global trade war, falling townhouse construction, weakening net migration gains, higher prices promised for electricity and council rates, shrinkage in the sheep and beef sector, and the need for extra efforts to rein in the Government’s deficit.
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