Homeowners could save more than $90,000 over the life of their mortgages by shopping around, according to an analysis of 95 floating home loans.
A survey by independent researcher Canstar found a difference of more than half a percentage point on the residential mortgage packages from 10 different providers.
Yesterday, the state-owned Kiwibank had the lowest floating rate of 5.60 per cent, while a BNZ loan had the highest rate of 6.19 per cent. There were higher rates offered for those who had a deposits of less than 20 per cent and BNZ did have packages with lower rates on the market.
Monthly mortgage repayments for a 30-year $300,000 loan for those paying the higher rate would be $1835, while the lower rate would require minimum monthly repayments of $1722 - a difference of $113 a month.
But Canstar general manager Derek Bonnar said if borrowers were to negotiate the lower rate with their provider, and keep up the repayments of $1835, they could knock off $93,000 and cut the term by more than four years.
"The interest rate on your home loan remains one of the biggest factors affecting the cost of the loan over its lifespan," Mr Bonnar said.
"For households, keeping repayments slightly higher when negotiating a low rate could potentially mean a fantastic overseas holiday, or retiring a year earlier. It is well worth the effort."
Canstar also assessed home loans across five categories - floating, fixed and line of credit for both investors and owner-occupiers - using a snapshot of home loans at February 28.
Interest rates made up 80 per cent of the score but providers were also judged on the loan approval process, switch fees, lending terms, redraw and offset facilities, split facility (part floating, part fixed) and security.
Overall, Kiwibank achieved a five-star rating in four categories, Westpac earned five stars in three categories, SBS earned five in two categories and ANZ's Line of Credit earned the institution a five-star rating.
Bruce Thompson, Kiwibank communications manager, said: "These awards are important to us because they're independently assessed and they essentially vindicate that we are providing value and that's always been what we stand for when we started more than 12 years ago.
"It shows that we've got sharp pricing and we should always be on the shopping list.
"We believed there was room for a bank, particularly a New Zealand-owned bank, that could genuinely compete and genuinely provide value."
National average house asking prices and prices in three regions reached new record highs, according to realestate.co.nz's report out yesterday.
The national average sat at $484,263 - driven by Auckland's high of $683,169 (up 12 per cent in a year), Wellington's $469,487 (up 7 per cent), and Waikato's $393,612 (up 10 per cent).
Realestate.co.nz marketing manager Paul McKenzie said confidence in the major centres was rising, suggesting asking prices would continue to rise.
In the past month, new listings nationally had increased by 3 per cent, up from 12,167. Auckland's new listings increased by 5.2 per cent to 4389, Wellington by 10.8 per cent to 1136 and Canterbury by 3.7 per cent to 1453.