We’ve got our next Official Cash Rate (OCR) announcement coming up in a few days’ time, on 8 October—and it’s expected to bring some good news.
Most are picking at least a 0.25% cut from the Reserve Bank, if not 0.50%.
Once that’s filtered through to mortgage rates, we should be seeing one-year rates consistently down around 4.50%. Of course, BNZ has led the charge on that, dropping its one-year rate to 4.49% earlier this week as it seeks to grow market share.
That’s probably about as low as those shorter-term rates are going to get.
At the longer-term end of the spectrum, we could see the three-year fixed rate drop from its current 4.95%—which is already really attractive—down to about 4.80%. That would be a great rate to lock in at.
For anyone looking to fix or refix their mortgage at the moment, splitting half on short-term and half on longer-term is still a good bet, so you’re taking advantage of lower rates while also having some rate certainty over the longer-term portion.
Despite what our latest GDP result (released last month) would suggest, things do feel like they’re starting to pick up a little out in the economy.
That will continue as we get closer to Christmas, and into the new year, as more and more people start to benefit from lower rates, leaving them with a bit more money in their back pockets.
__Check in again next week for the latest news on New Zealand interest rates. __
