Mortgage Rates & Advice

For most of us our mortgage will be the biggest loan we will ever take out. Very few can afford to buy a home with cash so a mortgage is an inevitability for those of us who choose to venture into home ownership. Browse Mortgage rates here before you go and speak to a bank or Mortgage Broker to work out the best deal that will work with your lifestyle and investment approach.


Latest Bank Home Loan Rates
Bank Floating 6 Month 1 Year 2 Year 3 Year 4 Year 5 Year
ANZ 5.79 4.99 4.99 5.35 5.59 5.89 6.09
ASB Bank 5.80 5.35 4.85 5.14 5.49 5.89 6.09
BNZ - Std, FlyBuys 5.90 5.35 4.99 5.19 5.49 5.89 6.09
Kiwibank 5.70 4.99 5.09 5.19 5.65 5.75 5.99
SBS Bank 5.79 5.25 4.99 5.19 5.49 5.89 6.09
TSB Bank 5.65 4.99 4.80 5.15 5.45 5.75 5.99
Westpac 5.84 5.25 4.99 5.29 5.59 5.89 6.09

 Applying For a Mortgage

Some people can afford to buy a house outright. However, for many some form of finance, normally in the form of a mortgage, is needed. It is important to fully understand what type of mortgage you will need before committing.

Mortgages come in various packages, the main three being:

  • Fixed - a fixed home loan is where you lock in a set interest rate for a certain period of time so that your repayments are set to a fixed amount
  • Floating - a floating or variable home loan means that your repayments follow where the market goes.  If the interest rates go up, your repayments will follow and the same if the interest rates go down
  • A combination of fixed and floating - balance the risk with a combination of both

Each home loan will have different terms, including how long the home loan is for, and your loan amount will depend on your deposit. The amount needed for a deposit will depend on the type of property you buy and the relative terms set by the bank.

Before you commit to an offer or to buying a property, you can get a pre-approval from the bank. By deciphering your financial situation they will tell you whether they will guarantee you finance, and the maximum amount they will guarantee. This will help to establish your maximum price point when searching for a property.

An easy way to establish this informally before you start house hunting, is by checking out a mortgage calculator, available here, on any of the major banking websites or Sorted.

 

 


Latest News & Articles

Get right up to speed with what has been happening in the NZ property market as our Head of Research Jonno Ingerson takes you through the latest trends, with some very interesting new developments!
 
Topics covered in this months short video include the drop in buyer demand, sales volumes are on the decline and all types of buyers are getting impacted. Watch the video here. 
 
This easy watch will bring you right up to speed - covering the main things of interest including market activity, values and buyer types active in the market.
 

This monthly report created by the CoreLogic NZ Research Team covers the main economic factors that influence the housing market, and then looks at sales volumes, values, and active buyer types in both the national and main centre housing markets.
 
 
Some highlights of the May - June 2017 report:
 
  • Consumers remain optimistic about the economy and the employment market is strong.
  • The net loss of Kiwis to Australia has begun again after a few months of net gain. However recent announcements from Australia changing entitlements for Kiwis living there may mean we don’t see the same flood across the Tasman as we are used to seeing.
  • Dropping demand leads to dropping sales. In Auckland volumes are down 30% year on year, slightly less in Hamilton and Tauranga, and less again as you move further south. But the slowdown in sales is nationwide.
  • The drop in sales has hit all types of buyers, not just investors. So while the share of sales to investors has rebounded, the actual number of investors is well down. First home buyers are significantly down in numbers in Auckland, even though their share has held steady, but in Wellington their share of sales is still holding firm as those buyers continue to be active in the outer areas of the city.
  • With dropping demand and sales, a rise in listings, and more housing policy announcements likely over the coming months, we expect the market to continue to weaken until well after the election.
 
To download the full report click here.
 
The Ministry of Business, Innovation and Employment (MBIE) has announced a new measure for housing affordability and it’s being referred to as a ‘world first’. CoreLogic is proud to be providing data that forms part of this measure.
 
The Housing Affordability Measure (HAM) will eventually be released quarterly and aims to deliver a more accurate understanding of how much is spent on housing by New Zealanders. It also tracks the factual reality behind the age-old debate currently raging between millennials and baby boomers - whether housing is becoming more (or less) affordable over time for those renting, and for first home buyers too.
 
Having a more robust picture of affordability will in turn help better inform government policies and decisions around housing for New Zealanders. CoreLogic is proud to be providing data that forms part of this measure, alongside Statistics NZ, the Reserve Bank of NZ, the tenancy bond database and other data such as housing service costs, social welfare and tax data. 
 
What the first measure tells us:
So, what does the very first measure show? The first available data is captured from March 2003 - June 2015 and shows that unsurprisingly it’s more unaffordable to buy than rent. But perhaps more importantly, it highlights that nationwide housing affordability has remained relatively stable since 2009. 
 
This is despite strong property value growth occurring in this time. From early 2012, when the average property value was roughly $400,000, to the middle of 2015 (when the HAM series ends) values have increased by 30% ($520,000), yet the affordability measure hardly moved. 
 
The lack of change in affordability is mostly due to persistently low interest rates during this time and is further verified when analysing first home buyer activity during this period. According to the CoreLogic Buyer Classification series, first home buyers nationwide accounted for between 17% and 20% throughout this time, the only major shift occurring after the first round of loan-to-value restrictions were introduced by the Reserve Bank in late 2013. 
 
How this measure will be used:
CoreLogic Senior Research Analyst, Nick Goodall comments: “It’s really important to understand that this series is experimental and is undergoing a period of user testing. MBIE have been very clear that the measure maps the shifts in affordability over time but does not define the percentage of households able to afford a home, because the term ‘affordable housing’ can be very subjective. We consider that when used in conjunction with other measures/reporting, it will be a very useful tool for understanding the property and rental markets and the forces driving them”
 
You can read the first report using HAM here.
 
Jonno Ingerson, Head of Research, CoreLogic NZ Ltd.
 
The latest QV house price index is out. Nationwide values have remained dead flat over the past three months, leaving the annual change at 11%. Previously, we’ve seen Reserve Bank lending restrictions resulting in a very brief flattening of nationwide values in early 2014 and again in early 2016. This time however, the slowdown has already lasted longer than we’ve experienced before.
 
Main centres
Much of that nationwide figure is driven by Auckland, where values are down 0.4% over the past three months.
The chart below shows the change in average value of housing stock in each of the main centres.
 
 
 
Auckland’s value drop over the past few months is clear, and the short-lived decline in Hamilton appears to have ended with a slight rebound in values.
 
Tauranga’s rate of growth has slowed considerably, with the last few months being barely above flat. Wellington’s growth has slowed a little since the middle of last year, which you can see in the very slight change in slope of the Wellington line. It remains the fastest increasing of all the main centres with a shortage of both new housing and properties listed for sale keeping the upward pressure on prices.
 
In Christchurch, values have also been very gradually decreasing since November 2016. That follows a couple of years of values increasing very gradually.
 
Dunedin shows a slight wobble in late 2016, but in the last few months values have resumed their steady increase.
Clearly, there are different patterns emerging across New Zealand, but the main theme is that previous rates of housing value growth have slowed considerably. Remember that in the middle of last year values were increasing strongly almost everywhere.
 
 
Across the country
Let’s move beyond the main centres to look at a heatmap showing all the local council areas, large and small:
 

 

The size of the bubbles on the map represents the number of sales over the past three months in that area (larger bubbles means more sales). The colour of each bubble represents the value change over the past three months. Blue means values have dropped more than 1%, grey depicts where values have been pretty much flat (at between -1% and +1%), light orange represents 1% to 3% growth, improving to dark orange (3% to 5%), and finally red for growth greater than 5%.
 
The cluster of bubbles around Auckland corresponds to the old pre-Supercity Council areas (which many people still relate to). They show North Shore and Waitakere dropping slightly in value, whilst Auckland City and Manukau are flat. The fringe areas of Papakura and Rodney are still rising modestly.
 
Tauranga is the other big grey bubble, along with Taranaki. They are the clearest examples of previous value growth slowing to near zero. Much of the rest of the North Island still appears to be increasing strongly, although what this map doesn’t show is that many have slowed in the past three months.
 
In the South Island, Canterbury stands out as a large area where values are more or less flat. This flattening also extends to Marlborough, Queenstown and Invercargill. Other larger South Island centres such as Nelson and Dunedin carry on climbing.
 
 
Top 10 fastest increasing
The dark red dots across the country that catch your eye are those areas that are increasing the fastest in value. Let’s take a look at those in more detail:
 
 
 
The table shows the top ten areas by percentage increase in value over the past three months.
 
The two areas with by far the most exceptional value increase over the past three months have been Opotiki and Rangitikei. Both of those areas are quite small, and the relatively low number of sales can mean that the house price index bounces around from month to month, making you think there is a change when there isn’t. That is not the case with any of the small areas in this list where the increase in values are part of a much longer lasting upward trend that started in early 2015,
reversing the steady downward trend that began in 2008.
 
The Opotiki District has one main town, Opotiki. Rangitikei has four main towns: Bulls, Marton, Hunterville and Taihape. All show the same upward trend in values. In both Rangitikei and Opotiki it is worth noting that despite increasing in value by 26% over the past year, they have only just made it back to the value they were at in 2007 before the Global Financial Crisis and subsequent recession. 
 
The increase in value over the past 18 months in these areas is in line with almost every part of New Zealand. New Zealand’s high net migration, fuelled in part by far fewer Kiwis going to Aussie from every town and city will be helping to fuel this value growth. So too will the loosening of the lending restrictions outside Auckland in late 2015, although they have now been tightened again. Record low interest rates are also in the mix, along with a desperate shortage of properties listed for sale.
 
Mackenzie is number three on the list and is now a whopping 73% higher in value than it was in the 2007 peak. The main towns in Mackenzie are Fairlie and Twizel. Both towns were unusual in that values didn’t drop during the GFC, and Twizel in particular has thrived from the booming tourism sector.
Coming in at number four is Tararua which has also now just clawed back to 2007 values. The four main towns of Dannevirke, Woodville, Pahiatua, and Eketahuna have all been increasing since mid to late 2015, with just a hint of slowing down in the last month or two.
 
Numbers five and six, Thames-Coromandel and Kaipara respectively, both have the influence of Aucklanders and Auckland money helping keep the markets strong.
 
Neighbouring areas of Wanganui and Rangitikei (Raetihi, Ohakune, National Park and Taumarunui) are also areas that are only just approaching 2007 values. In Rangitikei there are the first signs that the rapid increases of late 2016 may be backing off this year, particularly in Raetihi.
 
Central Otago at ninth place is increasing in value in large part due to an overflow from Queenstown where a shortage of housing means large numbers of workers in the tourism and services sector are living in the surrounding areas.
Porirua at number ten on the list is benefitting from a bouyant Wellington area market. As values in central Wellington have climbed over the past couple of years, first home buyers in particular are now looking at more affordable fringe areas such as Porirua. The three month increase in values is at a similar rate to the past year, showing that Porirua really hasn’t slowed at all in the past few months like other areas have.
 
One of the characteristics shared by many parts of the country, especially outside Auckland, was a huge surge in sales activity during 2016. In many areas the number of sales was at or beyond those last seen in the previous boom of the market in 2005 to 2007. That surge in sales activity came at a time when new listings were weak, meaning that the total choice of properties for sale reduced further. This further worsened the high demand, low supply dynamic, pushing prices up.
 
There has been a large drop in sales activity so far in 2017 compared to 2016. This is partly attributable to the latest round of Reserve Bank lending restrictions, but rising interest rates also play a role.
 
While the Reserve Bank has kept the official cash rate at record low levels, fixed term mortgage interest rates have risen this year. This reflects the higher cost of money that the banks need to source offshore to fund their mortgage lending. The average two year fixed interest rate rose around half a percent in the first few months of 2017, and while this is not a huge increase, every little increase in interest rates means that borrowers can borrow less. This increase in fixed term interest rates is likely to continue.
 
Another factor leading to less activity is that the big banks are now much stricter about the recipients and amounts of lending. In many cases they are going well beyond the expectation of the latest Reserve Bank lending limits. The banks are increasingly nervous about continuing value increases and are looking to reduce potential risk should there be a downturn, or a change in conditions that make it harder for borrowers to pay their mortgages.
 
This drop in sales activity will likely mean that values will not increase as quickly as they did when there was more sales acitivity. Our CoreLogic buyer demand measure, which predicts sales activity in the subsequent weeks, showed some very low weeks across the country in the lead up to the recent holiday periods of Easter and Anzac weekend. If that weakness carries on now that we are heading into winter, then we can expect sales activity to drop further. That should take more heat out of values, and I’m expecting that the usual  recovery the property market enjoys in spring will be interrupted by the General Election.
 
I still don’t believe that we are going to see a sustained drop in values in Auckland or elsewhere. The population is continuing to grow faster than we are able to build houses, and until that reverses one way or another then values are unlikely to crash. But the greater degree of slowdown in Auckland suggests that affordability may now be biting harder. If that is the case, then along with tighter and more expensive lending, a rebound in Auckland values next summer will be more muted than we have seen previously. 
 
 

 

The latest monthly QV House Price Index shows that nationwide residential property values for April increased 11.1% over the past year, which is the slowest annual rate of growth since July 2015. Quarterly value growth plateaued with a 0.0% change over the past three months. This means nationwide average value remains at $631,147 which is 52.3% above the previous market peak of late 2007. When adjusted for inflation the nationwide annual increase drops slightly to 8.7% and values are now 27.2% above the 2007 peak. 
 
Residential property values across the Auckland Region increased 10.7% year on year which is the slowest annual rate of growth since December 2014 and quarterly growth decreased by 0.4% over the past three months. The average value for the Auckland Region is now $1,043,830 and values are now on average 91.0% higher than the previous peak of 2007.  When adjusted for inflation values rose 8.4% over the past year and are 59.4% above the 2007 peak. 
 
 
QV National Spokesperson Andrea Rush said, “Nationwide quarterly value growth has plateaued over the past three months as the housing market continues to be constrained by the latest round of LVR restrictions.” 
 
“Values dropped in parts of Auckland and Christchurch over the past quarter and the rate of value growth has slowed considerably in Tauranga and Queenstown.”
 
“Meanwhile, the average value across the Wellington region has now topped $600,000 however the rate of value growth there is also continuing to slow but market remains buoyant particularly in more affordable parts of the region such as Porirua and the Hutt Valley.”
 
“The Wairarapa and Masterton markets are now seeing strong value growth as a flow-on effect of recent growth in Wellington values.” 
 
“The Dunedin market also continues to rise steadily and Hamilton values are now increasing in the city again after a recent downward trend that followed the new loan restrictions.” 
 
“Nationwide sales volumes have continued to be relatively weak and despite sales picking up in March as compared to February; they were at the lowest level for March since 2014.” 
 
“The latest CoreLogic Buyer Classification data for Quarter 1, 2017 shows while the value of lending to investors (as reported by RBNZ) has dropped for several months, their 39.0% share of all residential sales remains propped up by cash investors not requiring a mortgage. This was at the expense of the first home buyer share which slipped marginally from 21% in 2016 to 20%, and the share of sales to those moving home which has seen the greatest decrease is down from 30% to 27%.” 
 
Auckland
Values across the Auckland Region are continuing to show a slight drop of 0.4% over the past three months. Values on the North Shore, Waitakere, in parts of Manukau and Auckland City central suburbs decreased during the quarter, while values continued to rise in Papakura, Franklin, Rodney and Waiheke Island.
 
QV Auckland homevalue Manager, James Steele said, “Demand is still down as tougher lending restrictions continue to make it difficult for buyers requiring a mortgage to obtain finance for their purchases.”
 
“However, cash buyers and those who are able to obtain funds, or are able to use equity built up over the past five years of substantial growth, are out hunting for good deals.” 
 
“Well presented properties in decent locations are still selling well although it’s taking a little longer than when the market was very hot and properties which are in poor condition or have issues are sitting around for a lot longer if vendors are unwilling to negotiate on price.”
 
“First home buyers continue to prop up entry level areas, but appear to be favouring property which is ready to move in to.“
 
 
 
Hamilton  
Hamilton home values are rising again with values up across all parts of the city over the past three months. Overall values for Hamilton city have risen 14.4% year on year and 1.4% over the past three months and they are 49.1% higher than the previous peak of 2007. The average value in the Hamilton is now $538,832.
 
QV homevalue Hamilton valuer, Stephen Hare said, “The Hamilton city market is still experiencing steady demand similar to that seen during the first quarter of the year, with levels of interest not as a strong as late last year but homes are still selling.”
 
“With the heat now having come out of the market, auctions have become the less attractive course of action when selling a property with more properties being passed in at recent auctions.”
 
“In turn listing prices or negotiations are becoming the more desirable option with people less inclined to take that risk of selling by auction in the current market. This also enables first home buyers to do more due diligence once a contract has been entered.”  
 
“There are reports that there is a shortage of rental property available in Paeroa, Thames and Matamata.”
 
“The key driver of this is new home owners/occupiers buying up portions of rental stock and this pressure has in turn created more demand for rental properties, thus driving prices up steadily. This is becoming a growing trend throughout small towns within the Waikato region.”
 
 
Tauranga
The rate of value growth in the Tauranga market has been slowing since the introduction of the LVR restrictions late last year and this trend has continued over the past three months, with value up just 0.9% over the past three months. Values there rose 17.5% year on year and they are now 40.9% higher than the previous peak of 2007. The average value in the city is $678,643. Meanwhile, the Western Bay of Plenty values have increased 15.9% year on year and 2.7% over the past three months. The average value in the district is now $590,783.
 
QV homevalue Tauranga, Registered Valuer, David Hume said, “Agents are reporting more normalised activity in the sub $700,000 bracket. 
 
“Well located properties over $1,000,000 continue to be in good demand. “
 
“Some agents are even reporting a softening of values for investment properties which is likely to be due to some investor’s finding it more difficult to gain finance to purchase with the higher deposit requirements.”  
 
 
Wellington   
The QV House Price Index shows values across the Wellington region continued to rise up 21.2% year on year and 3.4% over the past three months and values are now 32.2% higher than in the previous peak of 2007. The average value across the wider region there has now topped $600,000 and is $602,230. 
 
Wellington City values rose strongly over the past year up 20.8% and 3.1% over the past three months and the average value there is now $724,176. The Hutt Valley is still accelerating with Lower Hutt values up 25.1% year on year and 4.3% since February; Upper Hutt is up 26.6% year on year and 2.8% over the past three months. Porirua values are up the most over the past three months rising 5.5% since February and 24.4% year on year. The average value there is now $510,853. Meanwhile, values on the Kapiti Coast are also continuing to rise up 20.9% year on year and 1.8% over the past three months.
 
QV homevalue Registered Valuer, David Cornford said, “Value growth has remained fairly consistent over the past month and Porirua has again seen the greatest value growth in the region, followed by Upper and Lower Hutt.”
 
 Value growth in these areas is supported by a strong first home buyer presence in the market while the Wellington City has market has slowed slightly as first home buyers continue to turn to Porirua and the Hutt valley as they provide a more affordable option.”
 
“The number of listings has increased and this is providing buyers with more choice which has taken some of the heat out of the market. Also, investors requiring finance are less active in the Wellington city market since the introduction of LVR restrictions last year due to the higher deposit required.”
 
“This has resulted in the average number of days to sell increasing and more buyers are now placing conditions on contracts.”
 
“On the Kapiti Coast, good sale prices are still being achieved across the region with the largest percentage increases occurring in Waikanae Beach and Otaki.”
 
“There are good turnouts at home homes with a large proportion of interest coming from outside the region, in particular Wellington and the Hutt Valley.”
 
“The market for investors on the Kapiti Coast remains strong despite the introduction of higher deposit requirements.”
 
“Strong demand and high sale numbers for the Wairarapa region is also resulting in values continuing to rise there and there are now fewer entry level Wairarapa properties, favoured by investors and first home buyers, available and agents are being rushed off their feet with lots of quick sales occurring.” 
 
 
Christchurch 
Home values decreased slightly over the past three months in most areas of Christchurch City with the exception of the Waimakariri District and the Christchurch – Hills suburbs where values were up 1.6% and 0.8% respectively since February.
 
Christchurch City values increased 1.4% year on year and they are now 30.7% higher than the previous peak of 2007. The average value in the city is now $495,855. 
 
QV homevalue Christchurch, Registered Valuer Daryl Taggart said, “While there is still plenty of building going on around Christchurch, the residential market does appear to be flat lining in terms of value growth.”
 
“Currently there are not many drivers at play in the Christchurch housing market with less demand meaning that in general properties are taking longer to sell that in previous years.”
 
“First home buyers are still reasonably active and given that entry level properties in Christchurch are more affordable than the likes of Auckland and Tauranga.” 
 
 
Dunedin
The Dunedin market continues to be buoyant with city home values rising 17.0% year on year and 3.5% over the past three months and values are now 29.9% above the previous peak of 2007. The average value in the city is now $371,739. 
 
QV homevalue Dunedin, Registered Valuer, Duncan Jack said, “Demand from buyers remains strong.”
 
“There are reports of an increase in unconditional offers which may be an indication of buyers’ current eagerness to secure a property amidst strong competition.”
 
“Properties continue to sell quickly – particularly those within the mid-value ranges and value levels appear to be continuing to strengthen.”
 
“Sales numbers have increased the last 2/3 months since dropping off over the Christmas and summer break.”
 
 
Nelson
Nelson home values continue to see good value growth rising 16.9% year on year and 3.8% over the past three months. The average value in the city is now $527,422.  Values continue to rise in the Tasman District up 16.9% year on year and 4.7% over the past three months. The average value in the district is now $521,575. 
 
QV homevalue Nelson, Registered Valuer Craig Russell said, “Strong prices are being achieved in outlying small townships which typically lag strong value level growth in the main centres.” 
 
“Buyers at this stage of the property cycle often widen their purchasing parameters due to affordability and the trade-off of commuting.”
 
“Motueka values have increased considerably of late partly due to the relative affordability of property there compared to Nelson and Richmond.” 
 
“Investor activity appears to have cooled off as LVR restrictions and implications around “P” contamination may be one factor concerning investors in the local market.”
 
“The majority of buyers are more cautious with their purchasing decisions given buyer’s reduced tolerance levels for debt and possible increased debt servicing from increased interest rates on the back of strong inflation figures.”  
 
 
Hawkes Bay
Napier values are up 17.2% year on year and 1.5% over the past three months. The average value in the city is now $425,484 and values are now 25.0% above the previous peak of 2007. The Hastings market continues to see strong value growth up 22.8% year on year and 4.2% over the past three months and the market is now 31.1% higher than 2007. The average value there is now $408,510.
 
QV homevalue Hawkes Bay, Registered Valuer Michelle Drinkrow said, “The Hawkes Bay residential property market is continuing to see plenty of activity and continued growth with good value levels being achieved in terms of sales prices and demand remaining high.”
 
“Demand is exceeding supply on the market at the $1 million plus range around Havelock North with some of the demand coming from out of town buyers relocating to the Hawkes Bay due to the lifestyle and affordability offered in the region.”
 
“Investors appear to be active still particularly at the low-end of the market around areas such as Flaxmere. We are seeing two distinct types of buyers in the investment market: locals who are educated in the quality of the area and out of town investors who are happy to pay a little more as long as the numbers stack up.”
 
“There still remains a lack of vacant land available and builders are reporting high levels of activity. House and land packages are in good demand with some buyers prepared to pay a premium for good quality fit-out over basic style properties.”
 
 
Provincial centres
In provincial areas of the North Island, regional areas in relative proximity to Auckland continue to see values accelerate with the Kaipara and Thames Coromandel Districts now seeing value growth of more than 6.0% over the past quarter and more than 22.0% year on year. Opotiki in the Bay of Plenty has also seen values jump rising 14.9% over the past three months and 26.3% year on year. 
 
The only areas in the North Island to see values decrease over the past three months were parts of Auckland, Stratford and Waitomo. 
 
In provincial areas of the South Island, the MacKenzie District again saw the highest percentage growth with values up 8.3% since February and while quarterly growth in the previously hot Queenstown market slowed to 0.9%.
 
The only area in the South Island to see values decrease over the past year was the Grey District where values were down slightly by 0.1% and over the past quarter values dropped in parts of Christchurch as well as the Grey, Hurunui, Selwyn, Ashburton, Timaru, Waimate, and Clutha Districts.