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New Zealand’s largest mortgage lender is following ASB with its own rate hike along with Westpac and BNZ, so window for grabbing cycle-low fixed mortgage rates is closing soon

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Following a very direct and clear signal that the RBNZ has turned hawkish and is preparing to raise the OCR sometime later this year, banks have announced fixed rate hikes.

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move first, and before the RBNZ signal, was ASB.

The RBNZ is encouraging the move. Her minutes states: “The committee agreed that any future increases in mortgage rates will further slow house price growth.”

Rising inflation figures released on Friday have made a rate hike by the RBNZ in August seemingly inevitable.

These latest mortgage moves follow market reactions that saw wholesale interest rates rise sharply, as well as the NZD temporarily higher.

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New Zealand's largest mortgage lender is following ASB with its own rate hike along with Westpac and BNZ, so window for grabbing cycle-low fixed mortgage rates is closing soon

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First, Westpac signaled its rate hike last night, then BNZ raised rates and now ANZ has joined its own flat rate hikes on home loans.

However, ANZ has not increased their rates as much as ASB or BNZ, leaving their rate card below these major rivals.

One-year ANZ rate is up +31 bps to 2.50%. Their 18-month rate is up +39 bps to 2.74%.

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The new two-year ANZ rate is 2.90% and up +31 bps, while their 3-year rate is now 3.24% and up +25 bps.

ANZ is New Zealand’s largest lender and never really has much to offer borrowers in the four- and five-year region. They didn’t change these longer rates, but that did bring the difference down to a slightly lower level compared to ASB.

On the long side, Westpac has also taken some lower speed settings than ASB.

Of course, as with any bank, you can probably negotiate better rates (lower than these card rates), depending on the strength of your own financial position.

Kiwibank has not announced their changes yet. We would expect these sometime early next week if they don’t come today. So the chance to hit bottom-of-the-cycle prices is now very short.

Most of these banks have also increased a number of term deposits at the same time.

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Now that we are in the midst of the real estate season and sales volumes are declining somewhat, now is a good time for bank price managers to implement rate hikes. Even if they overdo it, it will allow them to offer “specials” and “discounts” when the spring real estate season kicks off — in just about eight weeks from now.

A helpful way to understand these changed mortgage interest rates is to use our full-fledged mortgage calculators. (Term deposit rates can be assessed using this calculator).

And if you already have a fixed-term mortgage that cannot be renewed at the moment, our break allowance calculator can help you assess your options. Break fees should be minimal in a rising market.

Here’s the updated snapshot of the lowest advertised fixed-term mortgage rates currently offered by the major retail banks.

New Zealand's largest mortgage lender is following ASB with its own rate hike along with Westpac and BNZ, so window for grabbing cycle-low fixed mortgage rates is closing soon

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New Zealand's largest mortgage lender is following ASB with its own rate hike along with Westpac and BNZ, so window for grabbing cycle-low fixed mortgage rates is closing soon

Select chart tabs »

1 year %2 years %3 years %4 years %5 years %7 years %10 years %

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Here the graph ’10 year %’ is drawn.
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The post New Zealand’s largest mortgage lender is following ASB with its own rate hike along with Westpac and BNZ, so window for grabbing cycle-low fixed mortgage rates is closing soon appeared first on Notesradar.

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