The country's biggest bank is offering the lowest floating mortgage rate for new build houses.
A group of newly constructed houses in Christchurch. Photo: RNZ / Maree Mahony
ANZ has undercut the lending market with a 1.68 percent floating rate on new builds, compared with the sector average of around 4.5 percent.
ANZ's managing director personal, Ben Kelleher, said increasing housing unaffordability was a concern.
"New Zealand's fundamental problem is one of supply and demand. Making it more affordable for people to fund new builds is one way we can contribute to increasing supply in the market."
The special rate will be available for 24 months for new builds and builds underway, with an offer of a $3000 cash contribution for first home buyers, and borrowers building a home rated 6+ Homestar, which equals or exceeds building standards.
Other conditions include having a minimum 20 percent deposit, and banking with ANZ.
Kelleher said moves by the government and the bank to tighten lending to property investors has had some effect on the housing market.
"This ... has resulted in fewer investors coming into the market. This has taken some froth out of the market."
Other lenders offering sub-2 percent floating rates include KiwiSaver provider Simplicity, ASB Bank, and Heartland Bank.