Home loan rates start rising

Home loan rates start rising

Interest rate costs for home owners are starting to rise even though the Reserve Bank last week left its Official Cash Rate unchanged last week.

Home loan comparison site www.mortgagerates.co.nz, shows that banks have started increasing their home loan rates and the increases which started slowly have today picked up speed.

ASB, Bank Direct and Sovereign have, today, increased home loan rates across the market. All rates of one year or more have increased with the biggest increases being for shorter term durations. ASB's one year rate is up 20 basis points to 6.15%, its 18 month rate up 40 points and two year rates up 25 points.

Earlier Kiwibank and Westpac made changes to some of their rates. Both banks moved their one0-year capped rate up 25 basis points. Westpac now sits at 6.75% which is 50 basis points higher than Kiwibank's rate.

Westpac also increased its six-month fixed rate by 26 basis points. This moves takes the rate to 5.85%.

Mortgagerates.co.nz publisher Philip Macalister says these are the first real changes to home loan rates for many months and they are a sign of things to come.

"Borrowers should be carefully considering their options and whether to move from floating rates to fixed rates."

While increases were forecast in the wake of the OCR announcement the increases coming through this week are earlier than many expected, Mr Macalister says.

You can check, compare and sort home loan rates at www.mortgagerates.co.nz

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