The majority of lending institutions lowered their two and three year fixed rates over the last 30 days, but all movements were minor adjustments that did not effect the overall range of the rates on offer. This fine-tuning had the effect of bringing lenders rates into closer alignment with each other, as opposed to delivering tangible benefits to homeowners, according to the latest mortgage interest rate survey to November 10, conducted by the Real Estate Institute of New Zealand.
Real Estate Institute national vice-president Graeme Woodley says that floating rates had remained virtually unchanged and that the small adjustments in the two to three year fixed mortgage market indicate an increasingly stable interest rate environment.
"The small downward movement in rates in the last two months has had little or no effect on the affordability of homes, it merely reflects the banks' efforts to remain within competitive reach of each other. Five year rates have begun to ease, as banks seek longer term commitments from their customers. All of this reflects the banks' belief that mortgage interest rates will remain at the current level for the foreseeable future.
Woodley said that although interest rates were relatively stable, fortnightly payments on a $100,000 loan (calculated on a floating rate) had risen significantly over the last three years.
"In November 1998, a loan on those terms would, on average, be $356.97 a fortnight. That fell in November 1999 to $342.86, but today that figure is $395.33. Considering that in the context of rising petrol prices and an escalating CPI, the New Zealand home owner is under increasing pressure."
One year fixed rates now range between 7.70 - 8.15 per cent, two year rates range between 8.05 - 8.50 per cent while five year rates continue to average around 8.40 per cent.
Floating rates range between 7.79 and 8.50 per cent. Two institutions reduced their floating rates by between 0.10 and 0.20 per cent.
One year fixed mortgage rates now range between 7.70 to 8.15 per cent range, consistent with last month, with some rates already within that range falling from 0.01 to 0.20 per cent.
Eleven lending institutions lowered, while only one raised, two year fixed mortgage rates, now ranging between 8.05 and 8.50 compared to 7.95 and 8.50 per cent last month, while three-year fixed mortgage rates now range between 8.10 and 8.60 per cent, compared to 8.25 to 8.60 recorded last month.
Two year rates eased by between 0.10 and 0.15 per cent, while three year rates eased by between 0.10 and 0.20 per cent.
Four to five year fixed rates made small movements downward, as last months rates of 8.25 to 8.65 per cent fell, now ranging between 8.20 and 8.40 per cent. Source REINZ
For full details of current rates see Good Returns Rates Table - Click Here
