Exclusive: New Zealand’s largest mortgage lender cuts interest rates on new buildings | 1 NEWS



People able to build their own home got an incentive as our largest mortgage lender offers sweeteners today.

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The government is trying to push investors to build new homes. Source: 1 NEWS

ANZ Bank told 1 NEWS that it will introduce a floating interest rate for borrowers who are building or building a new home at 1.68%.

“This is our way of helping to increase the supply of homes to make it cheaper for clients looking to build new homes across the country,” ANZ’s Ben Kelleher told 1 NEWS.

Although offered for two years, it is floating, which means it can rise as other interest rates rise.

Although fixed rates were low, floating rates remained much higher.

Economist Cameron Bagri believes the time has come to increase competition in the market and take steps to reduce the “daunting” floating rates.

Construction apprentice Daniel Cleminson says he discovered a high floating rate in complex construction.

New house, construction site. Source: istock.com

“When you only pay interest, interest rates are actually much higher than the lowest currently, so we were very surprised at how much they affected us,” said a man from Dunedin.

“If it were thrown away, it would make a huge difference to us.”

The government is encouraging investors to build new homes rather than buying up existing ones as pressure continues on the market and on early home buyers.

But rising costs of building materials, land problems and access to finance are holding back construction.

Cleminson says the hardest part of the whole process was getting money from the bank.


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