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Mortgage Interest Rates Up, Up, Up and Away

Press Release
December 5 2003
Up, Up, Up and Away

Rates increased consistently during November. The latest mortgage interest rate survey conducted by Good Returns (www.goodreturns.co.nz), showed that the frequency of increases slowed only as lenders held their collective breath for the Reserve Bank's OCR announcement this week.

Another interesting development this month was new variations to their lending products offered by some banks. For example, Westpac has withdrawn its 30 month rate and replaced it with an 18 month one set at 6.99%, while the BNZ announced a three year fixed rate of 7.60% with the first three months at 3.99%.

The survey showed that fixed rates for the month of November increased by up to 0.70%.

Six month fixed mortgage rates showed significant movement (one lender increased its six month fixed rate by 0.70%) particularly from some of the banks that have held the lowest rates.

As at 31 October the range of one year fixed mortgage rates was 6.25% to 7.54% compared with 6.15% to 7.32% at 31 October

Last month many lenders offered a 2 year fixed rate at 7.10%. This month 15 lenders offered the same loan at 7.40%. The range of 2 year rates as at 30 November was 7.10% to 7.93% compared with 6.50% to 7.77% last month. The graph illustrates the convergence by some lenders.

Three year rates increased by up to 0.5% last month - showing another trend this month with the rate of the increases itself increasing. 3 year fixed rates now range from 7.20% - 8.30% as compared with 6.70% - 8.02% last month.

Even floating rates were impacted this month with two lenders increasing their rates. The lowest floating rate on offer as at 30 November was 6.55%. The highest floating rate was 7.95%. The highest rate for November is 0.70% higher than that offered at the end of October.

Five year fixed interest rates now range from 7.60% to 8.29%.

Industry Commentator and editor of Good Returns and The New Zealand Mortgage Magazine, Philip Macalister said that he expects the plateau in rates to be broken as soon as the Reserve Bank has made its announcement. "Economists are divided over whether the Reserve Bank will increase its Official Cash Rate (OCR) from 5% this week" he says, "but all say it will happen soon. In which case we can only expect mortgage rates to stay on the up and up."

As at November 30, four and five year rates ranged between 7.5% and 8.29%.

-ENDS-

Good Returns provides a comprehensive database of mortgage rates and deposit rates.

To find out who is offering what rates and to sort them for highest to lowest (or vice versa) go to http://www.goodreturns.co.nz/section.php?CategoryID=200

To compare historical mortgage rates for all lenders go to http://www.goodreturns.co.nz/section.php?CategoryID=201

To compare deposit rates go to http://www.depositrates.co.nz

Media are welcome to use graphs from the Mortgage Rates comparison page as long as they are attributed to www.goodreturns.co.nz

About Us

Tarawera Publishing Limited publishes online money management Magazine Good Returns.
Good Returns publishes Mortgage Interest Rates and includes a rate comparison calculator. You can find it on www.goodretur ns.co.nz/section.php?CategoryID=200
It is also publisher of The NZ Mortgage Mag and the New Zealand Property Magazine.

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