After months of borrowing advice saying floating rates are the way to go, there has been a change of tune from BNZ economist Tony Alexander. He now says the time may have come to fix rates at one or two-years.
We also have a new graph up showing the significant movement in mortgage interest rates that has been experienced within past decade.
In mortgage rates changes Westpac shimmied up its six-month rate last Friday by six basis points to 5.75% and cut its one-year rate by four basis points to 6.25% bringing it in line with the median rate for the major banks. It also reduced its revolving credit rate to 5...MORE»
Floating rates continued their fall this week with PSIS being the first non-bank lender to reduce its floating rate this year, cutting it by 20 basis points from 5.95% to 5.75% along with its revolving credit rate. The median floating rate for non-bank lenders is 6.45% which is a significant 70 basis points higher. PSIS also dropped its discounted floating rate by 20 basis points from 5.45% to 5.25%.
Kiwibank made heads whip around in interest this week as it became the first bank to change its floating mortgage rate this year, cutting it by 14 basis points to 5.65%. This makes it the second lowest rate behind BNZ's TotalMoney product offered at 5.59%.
Four lenders made home loan rate changes this week in the lead up to Christmas, all increasing their one-year rates by between five and 26 basis points.
The past week has seen two trends. The main one is for long term home loan rates to rise. The other is for a couple of lenders to drop their floating and short-term rates.
A number of economists have been warning the boost to the housing market from the dramatic fall in mortgage rates through last year to March this year was always going to peter out.
There have been no home loan rate changes in the past week, but plenty of suggestions from the Reserve Bank and the Prime Minister some rates are too high. In this week's MortgageWatch Jenny Ruth looks at what are the best deals in the market.
The graph shows the significant movement in mortgage interest rates that has been experienced within past decade. Since 2000 the floating rate has peaked at 10.7% in mid 2008. The highest floating rates were 20.5% back in June 1987.
Disclaimer: Every possible effort has been made to keep the information in the rates tables as accurate as possible, however, neither the publishers of Mortgage Rates nor anyone engaged to compile these tables accept any liability for inaccuracies or any loss suffered as a result. It is strongly advised that readers check loan details directly with the provider concerned.