“These super low interest rates can’t last forever”
ANZ recently announced a 1.68% floating rate for new builds, which will be available for 24 months and is currently the lowest floating rate in the market.
The ‘Blueprint to Build’ discount will also apply to builds that are already underway, though ANZ managing director personal Ben Kelleher noted that the standard floating rate may change over time as market conditions develop.
Kelleher said that floating rates often allow customers more flexibility compared to fixed rates, and, by investing in new builds, ANZ is aiming to help close some of the gap between housing supply and demand.
“Customers usually choose a floating loan as part of their loan structure for more flexibility to utilise and manage their lending,” Kelleher said.
Read more: ANZ: Housing supply catching up to demand
“The flexibility to pay off loans sooner without penalty, and having access to credit when they need it is reflected in the higher interest rates on floating rate loans.
“In addition, many floating rate customers enjoy discounts on the carded rates depending on their circumstances.”
“We are concerned that increasing house prices are putting home ownership out of reach of many Kiwis,” he continued. “This is fundamentally an issue of supply and demand, and making it easier for people to fund new builds is one way we can contribute to increasing supply in the market.”
Commenting on the current interest rate environment, Kelleher said that although rates have remained low for some time, this “won’t last forever.” He said customers looking at borrowing should make use of the low market rates while they can, and should consider the incentives available to those who are looking at a new build.
“It’s a competitive market and banks are constantly assessing their rates,” Kelleher said.
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“What we would say is these super low interest rates can’t last forever. For those who already have home loans or those taking up this offer, they should take advantage of low interest rates to pay back as much of their loans as they can.”
“When it comes to the housing market, increasing housing supply requires all-of-society solutions across the private and public sector,” he added.
“This includes rethinking planning laws through RMA reform, addressing the cost of building, reforming the vocational education system to create more builders, and rethinking urban density issues.
“This offer is just one thing we can do to help people on to the property ladder and to increase the stock of healthier homes.”
