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Reserve Bank talks tough: When will relief come for home loan borrowers?

Reserve Bank talks tough: When will relief come for home loan borrowers?
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Turned a corner : Leading bank brings interest rate rise forecast forward

Game-changer : Bank announces sub 2 percent mortgage rate for new-builds

Game-changer : Bank announces sub 2 percent mortgage rate for new-builds Newshub 2 hrs ago © Image - Getty Images; Video - Newshub Related video: It follows months of increasingly lower interest rates. Longer-term fixed interest rates are starting to move up, but for some borrowers the bar on floating interest rates has moved lower. To support building more homes to boost New Zealand s housing supply, ASB Bank has announced a floating (variable) mortgage interest rate of 1.79 percent for new-builds. It s available to owner-occupiers and investors who are either buying a finished new build home (also called turnkey ) or building their own home from scratch.  

Bank announces sub 2 percent mortgage rate for new-build homes

Unlike a fixed interest rate, the new build floating rate (currently 1.79 percent) changes according to market conditions. ASB said the rate is linked to the Reserve Bank Funding for Lending Programme, a pool of funds available at the Official Cash Rate for banks to lend.  The bank said there s confidence these funds will stay low for the foreseeable future. If the Reserve Bank did change the discounted FLP rate then that would trigger us to look at the ASB Back My Build variable rate, but our intention is for our customers to enjoy the benefit of the FLP discounted rate, Sims added.   

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