Mortgages

Home loan interest rates war 'risks another boom'

The battle for home-lending customers, which has seen the two-year fixed interest rate fall to 6.9 per cent, is unsustainable and risked reigniting the housing boom, bank economists say.

Wednesday, November 17th 2004

ASB Bank on Friday lowered its rate to 6.95 per cent to undercut the Bank of New Zealand's market leading rate of 7.15 per cent.

However, the BNZ hit back with 6.9 per cent to maintain its promise of not being undercut till at least December 17.

In reality customers were generally able to get the lowest rate in the market regardless of who they banked with or the advertised rate.

National Bank economist John McDermott said the profit margin on the two-year rate was now so thin that after paying a mortgage broker's commission banks were making a loss.

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Unity First Home Buyer special 4.09
SBS FirstHome Combo 4.19
ICBC 4.49
Kainga Ora 4.59
Co-operative Bank - First Home Special 4.59
ANZ Special 4.65
AIA - Go Home Loans 4.65
ASB Bank 4.65
TSB Special 4.69
Co-operative Bank - Owner Occ 4.69
SBS Bank Special 4.69
China Construction Bank 4.95
Kainga Ora 4.95
ICBC 4.99
Nelson Building Society 5.09
Westpac Special 5.19
SBS Bank Special 5.19
Kiwibank Special 5.19
TSB Special 5.25
ASB Bank 5.25
AIA - Go Home Loans 5.25
ANZ Special 5.29
Westpac Special 5.49
BNZ - Std 5.49
ASB Bank 5.59
ICBC 5.65
Kiwibank Special 5.69
Kainga Ora 5.69
SBS Bank Special 5.79
Co-operative Bank - Owner Occ 5.79
AIA - Go Home Loans 5.89
TSB Special 5.99
China Construction Bank 5.99
SBS FirstHome Combo 3.29
AIA - Back My Build 3.34
SBS Construction lending for FHB 3.74
CFML 321 Loans 3.95
Co-operative Bank - Owner Occ 4.99
Co-operative Bank - Standard 4.99
ICBC 5.39
Kiwibank - Offset 5.75
Kiwibank Special 5.75
Kiwibank 5.75
Unity Standard 5.79

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