Banks including ANZ and Westpac have announced they will pass on rate cuts to borrowers, on floating rates at least, this morning.
NZFSG's Bruce Patten said the cuts were "great news", but only expects 0.2% to be passed on to fixed rates.
He welcomed the long-term nature of the OCR cut. "It's great to hear that the cut is being held for 12 months. This will give people confidence," he added.
Squirrel's John Bolton expects a busy period for brokers, as customers are expected to try and renegotiate their home loans in the home-buying process.
"There's going to be a rush of people wanting to get in on the new rate even if they're locked into settlement," he said.
Bolton says banks including ASB have typically allowed customers to take newer, lower rates, but other lenders charged fees.
"We will probably be doing a lot more loan structuring this week," he said.
Bolton believes adviser customer turnover could take a hit from the coronavirus crisis, with falling business confidence and people's employment at risk.
"Everyone is nervous and business confidence is getting smashed. The question is, how much will the housing market slow down? It will be like previous slowdowns, I don't think prices will change much, but people will stop buying and selling. For us mortgage brokers, it is going to be a return back to a semi-frozen market with lower levels of activity."
Benje Pattison said customers were likely to get "some modest relief" to rates, but said cuts may be limited.
"Bear in mind that our banks also have to borrow on international markets where credit will be in tight supply. As a result, banks are still likely to be more cautious about additional lending," he said.
Pattison warned New Zealand was "now in full-blown financial, as well as public health and economic crisis mode".
"The actions taken now are crucial to softening the interim blow, so that societies and economies can recover once the public health crisis comes under control," he added.
Kris Pedersen expects a "rush" of clients wanting to move to new lower rates.
"It’s hard to say until we’ve seen a few whether there will be value or not in it for them as in many cases the break costs may offset the rate savings."
Pedersen says banks may look to review their interest-only lending restrictions.
"It will be interesting to see if the banks relax their interest-only stance at all as this is quite tight at present but is another way to provide cashflow relief especially to SME owners."
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