The record low floating rate on mortgages is meant to stimulate new home construction. Photo / Paul Estcourt
ANZ disrupted the market by offering a record low floating mortgage rate of 1.68 percent for borrowers who are building new homes.
The rate is understated compared to rival bank ASB, which offers a 1.79 percent floating rate for new buildings, as well as Heartland Bank’s 1.95 percent floating rate and KiwiSaver’s 1.90 percent.
ANZ said that the discount on its regular floating rate will be available for 24 months on new and ongoing developments.
Its current standard floating rate is 4.44 percent and the bank said the floating rate may change during that time.
The Reserve Bank predicts that the official money rate will start to rise in the second half of next year, and floating rates are the rate that is likely to move in line with changes in the official money rate.
Ben Kelleher, personal managing director of ANZ NZ, said as New Zealand’s largest lender, the current housing market continues to worry him because home ownership is beyond the scope of many.
“New Zealand’s fundamental problem is supply and demand. Making it more affordable for people to finance new construction is one of the ways we can contribute to increasing supply in the market. ”
The bank will also offer up to $ 3,000 in cash to those borrowers who build a home with a Homestar 6+ rating.
Homestar is an independent home measurement tool that certifies the health, performance and sustainability of homes in New Zealand.
A rating of 6+ or higher means that the home was built to the current standards set by the New Zealand Building Code or higher.
Offer available from July 5th.
Borrowers must have at least 20% of equity or deposit in order to receive a discounted loan, as well as a transaction account with ANZ, into which their salaries are directly credited.