ASB mortgage cut sets new market low
ASB has cut its two-year fixed home loan rate from 5.45% to 5.25% a year – the lowest standard mortgage rate on the market.
Customers are also being lured to take up the rate with the offer of a free Samsung Galaxy tablet computer and up to $1000 cash.
The rate cut launches ASB’s spring home loan campaign, ahead of the traditional pick-up in house buying over summer.
New and existing ASB customers who take up fixed rates for the next three, four or five years for $100,000 or more will also receive a free Samsung Galaxy tablet, which costs up to $600 to buy in a shop.
The closest two-year rate offered by a major bank rival is Kiwibank on 5.35%.
Bankdirect is matching the rate on 5.25%.
HSBC says it is offering the lowest fixed-term rate in the market – 4.85% for a six-month term. However, that offer is for HSBC premier customers, who have either a minimum combined home loan of $500,000 or $100,000 in savings and investments.
The official cash rate, which influences the rates banks set for mortgages, is widely expected by economists to remain at 2.5% until the end of next year at least.
Data in the Reserve Bank’s latest monetary policy statement reveals there has been a dramatic shift away towards floating rates since the end of 2008, and that has accelerated again in the last few months.
The proportion of mortgages on floating rates peaked in April at 63.1% of all mortgages and has since fallen away to 58.7%.