NZ mortgage rates drop below 4%

'The banks are at it again' as they say, with both Kiwibank and Westpac both putting out low mortgage rates of 3.99 percent in the last couple of days. First it was Westpac with a one year 3.99 percent fixed rate, and now Kiwibank has gone one better with a two year rate of 3.99 percent. This is all on top of record low mortgage rates throughout the New Zealand banking system last year.

​So what does this mean moving into the rest of 2019? It's always to look into a crystal ball when it comes to mortgage rates, but given the fixed term one year rate of 3.95% ANZ offered last year was the lowest rate from a major bank since the middle of last century, these are definitely very competitive rates being put forward.

It's also important to keep in mind that there is currently $64 billion in debt throughout New Zealand. That's a 10% increase last year, so we might be getting close to a point where the banks have grabbed every quality customer available to them. Right now that means very competitive rates to keep the increase of customers and profitability, but as customers thin out, that model may need to change.

Either way, it certainly seems like an extremely competitive time to be in the market for a mortgage.