Big bank BNZ has joined some of its rivals in cutting a few mortgage rates.
BNZ today said new rates would apply to its Classic fixed home loans from six months to two years.
The bank moves follow last week’s official cash rate (OCR) announcement.
Some new BNZ rates applied to customers with at least 20 per cent equity in the property.
For six-month terms the new rate was 7.29 per cent, down from 7.39 per cent.
For one-year terms in this category, the mortgage rate was now 7.24 per cent, down 5 basis points from 7.29 per cent.
BNZ’s 18-month rate for special loans was now 6.89 per cent, down from 6.99 per cent.
And the special two-year rate was now 6.79 per cent, lower than competitor ASB’s 6.85 per cent.
The special category rates applied to residential owner-occupied homes and to residential investors.
For people not in the special 20 per cent equity club, there were some changes to standard loans too.
The BNZ six-month rates in this group fell to 7.89 per cent from 7.99 per cent.
One-year terms dropped 5 basis points to 7.89 per cent.
The 18-month offering was down the most, 10 basis points, to 7.49 per cent.
People with two-year standard loans would from today pay 7.39 per cent, down from 7.45 per cent.
Although the Reserve Bank kept the OCR at 5.5 per cent last week, its accompanying monetary policy statement was less hawkish than many commentators had expected.
In other words, the central bank didn’t spout bellicose rhetoric about needing to more aggressively fight inflation.
But the RBNZ hasn’t forecast a cut to the cash rate until well into 2025.
The bank home loan rates cuts emerged amid a possible property glut.
Barfoot & Thompson claimed 2255 new listings last month, compared with average new monthly listings of 1325 last year.
The agency’s managing director, Peter Thompson, this week said buyers in Auckland rarely had so much choice.
Major banks ASB and ANZ cut some home lending rates on Monday.
ASB said its one-year lending rate dropped 10 basis points from 7.39 per cent to 7.29 per cent.
And ASB raised its six-month term deposit rate by five basis points to 6.05 per cent.
After the cash rate announcement last Wednesday, the two-year swap rate, which can influence home mortgage rates, dropped to 5.05 per cent from 5.21 per cent.
Adam Boyd, of ASB, said the reduction to some mortgage terms partly reflected how swap rates responded to the Reserve Bank keeping the OCR at 5.5 per cent.
Inflation was also a factor in ASB’s home loan rates decision, Boyd said on Monday.
ANZ also dropped some of its fixed home loan and term deposit rates this week.
The 18-month lending rate had the biggest drop among ANZ offerings, down 26 basis points to 7.49 per cent for its standard rate and 6.89 per cent for its special rate.
The one-year fixed lending rate at ANZ dropped 15 basis points from 7.99 per cent to 7.84 per cent for its standard rate and 7.24 per cent for its special rate.
Meanwhile, BNZ rates for one-year-to-five-year term deposits dropped today, except for 18-month rates, which stayed at 5.9 per cent per annum.
The one-year rate dropped 10 basis points to 6 per cent. The two-year is down 5 basis points to 5.6 per cent.
The five-year rate had the most dramatic drop today, down 15 basis points to 5.1 per cent.
Reserve Bank says leaving banks to their own devices hasn't worked.