Home loan report - Home Loan rates keep rising
Weekly home loan report Home Loan rates keep rising
Changes to home loan interest rates last week support the view coming through in the opinion polls that there is growing pessimism about the economy.
During the past week there have been a raft of changes to interest rates - all rises - and that means borrowers costs are rising.
A common theme is that floating, or variable, rate mortgages continue to increase on the back of the Reserve Bank's recent announcement.
Since that announcement on March 10 all the major trading banks have increased their floating rate to 9% - the only exception being Westpac which is at 9.05%.
Not all the smaller banks have moved - those yet to go include: Bank Direct, HSBC, Superbank and TSB Bank.
The majority of floating rates currently fall in a range from 8.20% to 9.05%. (There are a couple of small lenders outside this range).
The other key theme during the week has been the growing number of lenders that have increased their fixed rates.
Again sticking with the banks, we have seen ASB, National, and Westpac increase most of their fixed rates. The only fixed rate to remain unchanged has been the two-year rate, which is where BNZ is waging its price war.
An example of the changes are Westpac's increases which are effective from 5pm today (Monday). It is increasing its six-month, three, four and five year rates by 30 basis points each to 8.10%.
In the two-year market BNZ has said that it will extend its Unbeatable campaign from a closing date of April 8 until the end of the month.
The only changes in the two-year market during the week have been three non-bank lenders, AXA, NZ Mortgage Funds and United Home Loans which increased their rates to 8.05%, 8.64% and 7.95% respectively.
Have any rates gone down in the past week? No.
What's the best deal at the moment? The two and three year rates on offer are seen as the best option at the moment as the margins on these rates are historically low.
Which one you go for depends, to some degree, on your view about what is going to happen with interest rates. People who are more optimistic that the interest rate rises will end soon will opt for the shorter term.