HSBC offers record low fixed rate

AUCKLAND: HSBC has launched a twoyear special rate of 3.69%, the lowestever fixed home loan rate from any bank.

The rate is available to new HSBC ‘‘premier customers’’ with either a minimum combined home loan of $500,000 or $100,000 in savings and investments with HSBC New Zealand.

It is also open to existing premier customers who borrow an additional $100,000 or more.

The special rate is also the lowest rate that HSBC has offered in the New Zealand market, trumping its previous lowest rate of 3.79% for a 2year term in August 2016, which at the time was the lowest fixed home loan rate offered in the New Zealand market for more than 50 years.

At the same time, HSBC has withdrawn its earlier summer mortgage campaign offer of 3.95% for one, two and threeyear fixed terms while reducing its two, three, four and fiveyear fixedterm home loans to 3.99%, 4.39%, 4.89%. and 4.95% p.a., respectively.

HSBC’s rate release comes as New Zealand’s twoyear swap rates have dipped 10 basis points from the start of 2019.

The bank’s New Zealand chief executive Chris Russell last month said its summer campaign was designed to stimulate demand in a ‘‘softening market’’.

‘‘I think there is certainly a bit of looking over the shoulder to the Australian market and wondering if it will happen here.’’

House prices in Sydney and Melbourne have fallen in recent months prompting concern that the falls will spread to Auckland.

‘‘What we have seen in Sydney and Melbourne does make Auckland seem expensive,’’ Mr Russell said.

But he also pointed to a lot more properties for sale in Sydney boosting the supply side which had not happened in Auckland.

Mr Russell said migration figures and GDP growth also remained strong in New Zealand.

‘‘There is nothing to suggest we are going to have a downturn.’’

Mortgage brokers say anyone due to refix their mortgage in the next 60 days should try to lock in an offer. Those who were due to end their fix term in the next six to nine months should weigh up the cost of breaking their mortgage to refix it at a lower rate.

Rival banks are said to be matching the rates even if their advertised rate is higher.