More banks join home loan rate cuts

RICHARD MEADOWS
Last updated 12:10 23/05/2012
mortgage
HEADING UP: Investors expect both their property value and rents to rise by 6-10 per cent over the next five years.

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Three more banks have slashed their fixed home loan rates, with the fierce competition between lenders now running into a second straight week.

BNZ cut its fixed mortgage rates across the board this morning, shaving off as much as 40 to 50 basis points to bring it in line with competitors.

The BNZ one-year rate is now 5.25 per cent, the two-year rate 5.65 per cent (GlobalPlus) or 5.5 per cent (Classic) and the three-year rate 5.75 per cent.

Longer term four-year and five-year rates were both cut 40 basis points to 6.1 per cent and 6.5 per cent respectively.

The Co-operative Bank dropped its two, three and four-year rates to match market leaders yesterday.

Also yesterday, HSBC cut its two-year rate to 5.5 per cent, just one basis point behind market leader ANZ National, and its three-year rate to a market leading 5.74 per cent.

However, those rates apply to Premier customers borrowing $500,000 or more.

The widespread movement in fixed rates has come in response to falling wholesale funding costs.

Floating rates, which are more closely aligned with the Official Cash Rate, remained unchanged.

The best fixed rates on offer so far (excluding specials):

Six months: 5.4 per cent - Public Trust

12 months: 5.2 per cent - TSB

18 months: 5.1 per cent - BNZ

Two years: 5.49 per cent - ANZ National

Three years: 5.74 per cent - HSBC Premier ($500,000+)
All major banks offer 5.75 per cent, excluding ANZ National

Four years: 6.1 per cent - all major banks, excluding Westpac and ANZ National

Five years: 6.2 per cent - HBS, SBS

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- BusinessDay.co.nz

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