Waiting for the Spring money sale

Spring is here, but the much anticipated home loan campaigns from the banks have yet to materialise.

While the banks have been quiet for the past couple of years, thanks to the global financial crisis and sad housing market in this country, it’s likely they will get out their box of party tricks very soon.

Unfortunately in this area we are currently following Australia. Across the ditch this week ASB’s parent, Commonwealth Bank of Australia has launched a campaign which looks a lot like the now infamous Unbeatable campaign BNZ ran in New Zealand a number of years back.

Commonwealth Bank is pledging to beat any advertised rate among its three big rivals
Meanwhile there has been little activity on the rates front in this country with few changes in the past month. The Reserve Banks is due to release its latest pronouncement on rates this Thursday.

Our survey of 13 economists shows that the majority aren’t expecting to see any increase until December.

Eight out of 13 are predicting the next increase will just before Christmas. Three of those eight are forecasting a 25 basis point hike to 2.75% however the reminder are opting for a 50 basis point hike.

Two economists though are predicting that the OCR will rise when the Reserve Bank releases its announcement in October.

The remaining three are suggesting increases won’t be until the first quarter of 2012.

The wide variation in predictions, including the size and timing of the next OCR increase shows that there is still a lot of uncertainly in the market.

The one thing that is certain is that as soon as the OCR increases floating rates will rise.

Our home loan rate table shows that the lowest standard floating rate at the moment is 5.60% from the Public Trust.  SBS and its subsidiary HBS Bank are close behind offering 5.65%

BNZ and Kiwibank offer 5.50% and 5.59% respectively for their offset mortgages, while Westpac has chosen to lead with its revolving credit mortgage, Choices Everday, at 5.60% while its standard floating rate is 6.24%.