"Apart from that group everyone else is well catered for. I don't think KiwiSaver will help the first home buyer particularly as they have got the bigger issue of saving a 20 per cent deposit. If they haven't got a decent income that allows them to save or parental support they are pretty stuffed."
Interest rates had fallen to the low fives and some cashback amounts were $3000. However, mortgage brokers "know where the pressure point is and where we can push it up to, if you are a private individual you don't know that number."
Discounted interest rates would last longer than a cash injection, he said.
"If you can get a reduction of half a per cent on your interest rate and are buying at $300,000 you will save $1500 per year. And effectively if you pay that three grand into your mortgage you will save $10,000 over the life of the mortgage."
"So these things are not to be sneezed at."
Majesty Mortgage Brokers director Luke Turner said its business was up 30 per cent.
The banks had become more aggressive since the introduction of the Loan to Value Ratio which had kickstarted a pricing war, he said.
"They have been more profitable of late so they have the margins to be aggressive on what we call pricing and cashback."
It was also getting home buyers over the line with less than 20 per cent deposit, he said.
"I wouldn't say that has loosened but the banks seem to have a better grasp of their lending now that there is 18 months of history. They are definitely more keen to lend to 80 or 90 per cent."
KiwiSaver would make a big difference to the deposit and the company already had four people who were waiting until April to build a brand new home.
"The buyer grant will go from $5000 to $10,000 per person or effectively $20,000 per couple. We are advising clients to wait until April unless they are in a big rush."
Loan Market Mount Maunganui mortgage advisor Frank Phillip said the market was poised in a position that had not been seen before.
"It is quite unique at the moment. As recently as the beginning of January the average two-year mortgage rate was 5.98 per cent. In recent weeks lenders have been offering two-year specials as low as 5.19 per cent."
The economy was growing at over 3 per cent and that would normally generate enough inflationary pressure to force the Reserve Bank to put up interest rates. However, the level of growth did not seem to be creating as much inflation as it used to, he said.
"Instead fixed mortgage rates are falling and the Reserve Bank is unable to increase the official cash rate due to prices in New Zealand and around the world falling."
Kiwibank communications manager Bruce Thompson said that six months ago it had a fixed rate for two years of 5.89 per cent. Now it was 5.39 per cent and $2015 cash, he said.
"Competition is fairly steady and we don't expect it to slow."
BNZ national manager Matt Nauer said home loans had been competitive for quite some time.
Banks were looking at different and better ways to deliver whether it was competitive rates, packages, new products, services or incentives, he said.
Interest rates remain low on historical standards which made buying a new home accessible for more people, ANZ head of mortgages Sarah Berry said.
"February and March are busy months for home sales. As a responsible lender we work to ensure a level of borrowing they can repay comfortably."
"It's in everyone's interests that customers are financially well off."
ASB head of home lending Vince Clark said competition had contributed to greater awareness among customers of the importance of ensuring the home loan they had or wanted worked best for them and their individual circumstances.
KiwiSaver helps property climb
Tauranga first-home buyer Craig Beswick is almost on the property ladder and has cashed in most of his KiwiSaver.
The 36-year-old was in the process of buying a $260,000 home in Brookfield and had to front up with $52,000.
"We are not signed, sealed and delivered yet, so to speak, but we are pretty close."
Visiting the bank on his own to negotiate a deal on a mortgage was daunting, he said, and that prompted a call to Chris Rapson, who negotiated on his behalf.
"I did try it by myself but it was so overwhelming that I went to a mortgage broker. He helped me immensely - it has been great as I have also had help with insurances, loan finance and budgeting. So I am very happy."
Mr Beswick took advantage of the current $5000 grant from the Government and a top up from his mum to achieve a 20 per cent deposit and he was thinking about fixing his mortgage for three years.
