PHOTO: It comes as falling house prices, tough lending conditions and rising interest rates have potential borrowers nervous. (Source: 1News)
Desperate banks are offering a range of deals to attract customers, as a perfect storm hits the housing and lending market.
BNZ and KiwiBank are both offering 1% cashback for customers (with conditions) – in some cases that could mean up to $20,000 – when they take out home loans.
ANZ has launched a special 1% interest rate for current borrowers who want to make their homes energy efficient. That could mean installing solar panels, heating and insulation or double glazing. The loan, of up to $80,000 could also be used to purchase electric or hybrid vehicles.
It comes as falling house prices, tough lending conditions, buyer hesitancy, and rising interest rates have potential borrowers nervous, all leading to a drop in mortgage applications.
ANZ’s Ben Kelleher says customers have been asking for incentives like the energy efficiency loan.
“The market has slowed down, you’re seeing it in house sales as well, the fear of missing out has gone and the fear of overpaying has come in, it’ll be interesting to see what happens in the summer months,” he told 1News.
Economist Hannah Ouellet from Sense Partners says the fact the housing market has cooled considerably, means it’s also a buyer’s market when it comes to competition at the banks. “Banks are competing for customers too”.
However, she thinks many of the deals on offer are targeting those on higher incomes, with higher deposits.
“Reading between the lines of the terms and conditions, it’s clearer that the larger the loan, the larger the cash back.”
READ MORE VIA 1NEWS
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