ASB takes -10 bps and -20 bps off most fixed mortgage rates, taking its 18 month 'special' to a market leading low. Westpac also trims a key rate (and cuts two term deposit rates)

ASB and Sovereign have reduced all their ‘special’ carded mortgage interest rates with fixed terms of 18 months and longer by -10 bps today.

And they have reduced all their standard rates by between -10 and -20 bps.

Westpac has also reduced a rate, taking their two year ‘special;’ down -5 bps to 4.74%.

Today’s changes come after Kiwibank and SBS Bank announced selected reductions a week ago.

The ASB moves open up a decided advantage for them in the 18 month space – that is a rate at least 45 bps lower than any of their main rivals, and it is also lower than most of the challenger banks. Only HSBC has a lower 18 month rate, for their Premier customers.

The mortgage market is tough at present. Not only are we in the off-season, real estate sales volumes are falling and buyers are apprehensive about where house prices are headed. The election also makes buyers naturally wary.

But banks are starting to position themselves for the post election and the up-coming spring house selling season. Getting a jump on it might seem like a good idea to some mortgage marketing managers.

Helping them is the general fall in wholesale swap rates, allowing these price reductions.

But that will have a dampening effect on term deposit savers.

And we have seen that today with Westpac reducing their four and six month term deposit rates by -15 and -20 bps respectively. ASB did not make any term deposit rate changes their announcement today, however.

The last time ASB changed rates was on August 11, 2017 when it trimmed its two year rate to meet the market.

See all banks’ carded, or advertised, home loan interest rates here.

Here is a snapshot of the fixed-term rates on offer from the key retail banks.

below 80% LVR 6 mths  1 yr  18 mth  2 yrs   3 yrs  4 yrs  5 yrs 
  % % % % % % %
4.99 4.55 5.15 4.75 5.59 5.89 6.09
ASB 4.95 4.45 4.60 4.69 4.99 5.49 5.69
5.35 4.59 5.05 4.79 5.09 5.89 6.09
Kiwibank 4.99 4.45   4.65 5.09 5.75 5.99
Westpac 5.25 4.59 5.15 4.74 5.09 5.89 5.59
               
4.80 4.59 4.75 4.79 5.09 5.55 5.75
HSBC 4.85 4.09 4.09 4.29 4.89 5.29 5.59
HSBC 4.99 4.59 4.85 4.79 5.25 5.49 5.85
4.85 4.55 4.75 4.79 4.99 5.65 5.79

In addition to the above table, BNZ has a fixed seven year rate which is 6.15%.

And TSB Bank still has a ten year fixed rate of 6.20%.