Bank of New Zealand and SBS have cut home loan rates, kicking off the first flurry of activity for the new year.

Minnow lender SBS attempted to lure Kiwis back from holiday with a "special" three year fixed term of 4.65 per cent, the lowest on the market. However, it was quickly overtaken by BNZ, which launched its own 4.49 per cent special on Monday morning.

The bank dropped its two year rate to 4.39 per cent, also leading the market in that category.

Like most home loan specials, the deals come with strings attached, requiring at least 20 per cent equity in the property, and salary paid into a transaction account.

Floating mortgage rates have also fallen after the Reserve Bank cut official interest rates in December. While the official rate of 2.5 per cent is now at its lowest since being introduced in 1999, some economists expect further cuts to come this year.