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Latest bank drops its fixed home loan rate to its lowest ever

As house prices continue to soar, Westpac has joined a number of banks in reducing its fixed home loan rate, dropping it to less than 2.3 per cent and one of the lowest rates in the country.

House keys (file picture). Source: istock.com

Today, the bank advertised a rate of 2.29 per cent for one-year fixed term. It's valid for customers who will be living in the home they buy and have a 20 per cent deposit. 

The new rates come in today and is a cut of 20 basis points.

The newest rate is one of the lowest in the country; other major banks ANZ, ABS and BNZ offer 2.49 per cent as their lowest rate while Kiwibank offers 2.55 per cent.

Westpac NZ general manager of consumer banking and wealth Gina Dellabarca said the bank wanted to help Kiwis with their home ownership goals. 

“We know property ownership has probably been a hot topic for many Kiwi families over the holiday period, so whether you’re looking to buy your dream home in 2021 or just pay off your mortgage a bit faster, this special rate could help you get there,” she said.

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“We especially look forward to talking to first home buyers about how we can support them to reach their home ownership goals and this rate can certainly help them.”

Existing mortgage customers who were due to renew their loan could also take advantage of the rate, Dellabarca said.

In October, Heartland Bank offered a 1.99 per cent rate for a one-year fixed loan, which remains the cheapest offering in New Zealand.

It was the first time a mortgage rate has dropped below two per cent in New Zealand, according to Interest.

Meanwhile, Quotable Value (QV) general manager David Nagel predicted in December last year property prices will continue to rise this year, but at a slower rate than 2020. 

Nagel said the market will cool when loan-to-value (LVR) ratios are reintroduced in March.