It’s nearly winter, and while the days are getting colder, the property market is throwing out some mixed signals. With the RBNZ releasing the OCR with a further 0.25% cut, bringing it down to 3.25%, the mortgage interest rates are also tracking downwards. As mortgage advisors, we’re always keeping an eye on trends so we can help you make smart, informed decisions, whether you’re a first-home buyer, investor, or just keeping tabs on your biggest asset.
Here’s a quick look at what’s been happening in the market lately and what it might mean for you.
More Houses for Sale = Softer Prices?
According to the latest ANZ Property Focus Report[i], there’s currently no shortage of homes on the market. In fact, listings are plentiful, and this is keeping a lid on property prices for now. Supply is outpacing demand, which means buyers have more choice and sellers have to be realistic with pricing.
But here’s the catch: this surplus isn’t expected to last forever. ANZ suggests we could start to see the market tighten again next year. If new builds slow down and migration remains strong, we could return to a housing shortage towards the end of the year 2025, and that may put upward pressure on prices again.
Floating Rates Drop Early – and OCR Follows
Big news hit the mortgage world recently: BNZ[i] cut its floating rate by 25 basis points (bps) before the Reserve Bank of New Zealand (RBNZ) officially changed the OCR (Official Cash Rate). That was a bold move and a clear sign that the banks are starting to anticipate easing in the interest rate environment.
Sure enough, the RBNZ followed suit just days later, cutting the OCR from 3.5% to 3.25%. Even more interesting? The RBNZ hinted that another cut may still come later in 2025[i], depending on how inflation behaves.
This matters because the OCR directly influences floating mortgage rates and often signals where fixed rates might be headed. A lower OCR generally makes borrowing cheaper and can take some pressure off both homeowners and property investors.
So, if you’re on a floating rate mortgage or have revolving credit, you should see your repayments dip slightly. If you’re on a fixed mortgage that’s coming up for renewal this year, it’s worth reviewing your options sooner rather than later.
We’re more than happy to help with that.
Mortgage Rates Below 4% Are Making a Comeback
If you’ve been holding out for better home loan rates, your patience might finally be paying off. We’re seeing sub-4% fixed rates[i] return to the market, especially on shorter terms like 1-year and 18-month options.
This is a big deal for both buyers and current mortgage holders, as even a small drop in your interest rate can save you thousands over the life of your loan.
That said, the best deal isn’t always the lowest rate. You’ll also want to consider:
- – Break fees (if you’re thinking of switching early)
- – Refix timing (lock in early or wait?)
- – Loan structure (fixed, floating, or split?)
- – Cashbacks and special offers (which may come with conditions)
Bottom line? There’s an opportunity in the current rate environment, but the right move depends on your situation.
Mortgage Rates Below 4% Are Making a Comeback
While buyers have more choice, many homes are just sitting on the market. Business journalist Greg Ninness recently reported[i] that unsold housing stock is “worryingly high”
heading into the winter months. That could be due to a few factors: cautious buyers, economic uncertainty, or sellers holding out for last year’s prices.
This is especially important for anyone thinking of selling. If your property is priced too high or isn’t presented well, it’s likely to sit for longer than you’d like. On the flip side, buyers might find motivated sellers and opportunities to negotiate.
Investors & Homeowners: Cashflow is Key
If you’re a property investor or have a rental portfolio, cashflow is probably on the top of your mind. BNZ’s Chief Economist Mike Jones recently noted[i] that “positive cashflow” from rental properties is becoming harder to achieve mostly due to rising costs like insurance, maintenance, and yes, those still-sticky mortgage rates.
It’s not all doom and gloom, though. A lot of property owners are adjusting by refinancing, tweaking rent, or exploring interest-only options for a season.
The good news? Lower interest rates might offer some breathing room soon. But it’s more important than ever to have the right structure in place, especially if you own more than one property.
So, What’s the Bottom Line?
Buying? You’ve got more choice now, and rates are improving, but this window might not last.
Selling? Be realistic with pricing and presentation, especially as stock is building up and buyers are shopping around.
Investing? Review your cash flow and consider refinancing strategies to stay on top.
Refinancing? Now would be a great time to compare deals. Sub-4% rates and floating cuts are back in the mix.
So, What’s the Bottom Line?
Let’s chat! Whether you’re refinancing, upsizing, diving into the market for the first time, or just wondering what the latest RBNZ cut means for your mortgage, we’ve got your back. Feel free to reach out to us. Let’s workshop to break it all down and help you make the best decision for your situation.
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