Long term home loan rates continue to fall
The past week has been a quiet one on the home loan front with the trend of the past couple of weeks, falling longer-term rates, continuing.
During the week seven lenders monitored by GoodReturns lowered their three and four year rates, and two lenders, AXA and Resi, dropped all their fixed rates.
A key event during the week was that ANZ replaced its 18-month rate for a 20-month rate of 7.69% - slightly lower than either its one or two year rate.
While no reason was given for this change it is likely to have more to do with balancing up the duration of loans on its book, rather than for competitive reasons.
What is the best deal for borrowers at the moment?
The consensus is that borrowing on a fixed term of around two years is the best option.
However there are some differences in opinion. ASB Bank and Westpac for instance are saying fixing for one to two years is the most appropriate action, while BNZ has a slightly longer time frame saying two to three years.
The common theme is that floating rates are not currently a great deal.
One of the main reasons is that they have been rising much more quickly than fixed rates, thanks to the Reserve Bank.
There has been little overall movement on rates currently offered.
One year fixed rates range from 7.60% to 8.58% with the main trading banks around the 7.80% mark. Five lenders (two of which are Canterbury-based – SMC and ABS Canterbury) are at 7.60% and NZ Mortgage Funds tops the table at 8.58%.
Three year rates are spread of a similar range with one lender on 7.60% and the highest in the market is GEM Home Loans at 8.35%.
To compare home loan rates go to http://www.goodreturns.co.nz/section/200.html
Or visit www.mortgagerates.co.nz
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