Three major banks have announced further cuts to mortgage rates ahead of the Reserve Bank’s official cash rate (OCR) review next week.
It follows the market’s recent trend which has seen rates for home loans drop in recent months.
ASB this morning announced a new “market-leading rate” of 6.25% for its two-year fixed term loan for those with 20% equity.
“ASB’s 18-month rate drops by 20 basis points from 6.69% to 6.49%, while its two-year rate drops 24 basis points from 6.49% to 6.25%.
“Longer-term rates are now all below 6%, with the three- and-four-year terms dropping 36 and 30 basis points respectively, now at 5.99%,” the bank said in a statement. It lowered some term deposit rates too.
BNZ also announced it was trimming its fixed term home and term deposit rates this morning.
As of today, the bank’s classic home loan rates – available to customers with at least 20% equity – are 5.99% (down from 6.39%) for three- and four-year terms, 6.34% (down from 6.49%) for a two-year term and 6.49% (down from 6.65%) for an 18-month term.
It’s six-month term went from 7.05% to 6.99%.
The bank’s standard home loans rates are now 6.59% (down from 6.99%) for three- and four-year terms, 6.94% (down from 7.09%) for a two-year term and 7.09% (down from 7.25%) for an 18-month term. It’s six-month term went down 0.06% to 7.59%
Shortly after, Kiwibank followed suit with an announcement of its own.
Alongside term deposit rate cuts, the bank announced new fixed special rates – available to customers with at least 20% equity – of 6.09% (down from 6.39%) for three- and four-year terms and 6.34% (down from 6.49%) for a two-year term. Its one-year term is 6.75% and six-month 6.99%.
Kiwibank’s standard rates have also fallen.
The change follows the release of Stats NZ figures last month showing the annual rate of inflation has fallen to its lowest level in three years, with only a 3.3% rise in the 12 months to the June quarter — close to the Reserve Bank’s 1-3% target range.
Bank economists are now predicting a cut in the official cash later this year.
