tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Monday, April 19th, 7:51AM

Mortgages

rss
Latest Headlines

Rising rates to end housing boom

Westpac economists predict rising mortgage rates will put an end to the NZ housing boom.

Wednesday, March 3rd 2021, 9:46AM 1 Comment

The Westpac team, led by Dominick Stephens, believe the current boom "has already passed its peak", amid record-low rates, a period with no LVR restrictions, and the rush to get ahead of new restrictions this year. 

"We expect the monthly pace of price increases will trend down from here. This gradual slowdown in the market will see house prices rise at a slower 7.5% pace in 2022, and zero in 2023. And eventually, we expect house prices to fall," the economics team said.

The bank is pencilling in a 4% drop in house price inflation over 2024 and 2025.

Rising mortgage rates will be a key factor in driving the market down, according to the report. 

A number of factors will force rates higher, Westpac said.

Wholesale markets have already begun to price in future OCR hikes, the RBNZ quantitative easing programme and LSAP will come to an end, and the Reserve Bank's new capital rules will force banks to push up rates, the economists added.

Westpac believes borrowers could be hit with higher mortgage rates by the end of the year. 

"We expect that the longest-term fixed mortgage rates, such as five-year fixed, will start increasing quite soon. Two-year fixed mortgage rates are expected to start rising late this year or early next," the team said.

Tags: house prices Lending Mortgage Rates OCR Westpac

« New build loan boostNew aggregator gets cybersecurity boost »

Special Offers

Comments from our readers

On 3 March 2021 at 12:12 pm Amused said:
The only function of economic forecasting is to make astrology look respectable.

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 2.29 2.59 2.65
ANZ 4.44 2.89 3.25 3.39
ANZ Special - 2.29 2.69 2.79
ASB Bank 4.45 2.29 2.59 2.65
Basecorp Finance 5.49 - - -
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.29 2.59 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 2.89 3.19 3.39
BNZ - TotalMoney 4.55 - - -
Lender Flt 1yr 2yr 3yr
CFML Loans 4.95 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland Bank - Online 2.50 1.99 2.35 2.45
Heretaunga Building Society 4.99 3.40 3.50 -
HSBC Premier 4.49 2.25 2.35 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - 2.25 - -
ICBC 3.69 2.25 2.35 2.65
Kainga Ora 4.43 2.67 2.97 3.13
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.40 3.20 3.50 3.50
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.35 2.65 2.65
Liberty 5.69 - - -
Nelson Building Society 4.95 3.20 3.24 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
Lender Flt 1yr 2yr 3yr
SBS Bank 4.54 2.79 ▲2.99 ▲3.29
SBS Bank Special - 2.29 ▲2.49 ▲2.79
Select Home Loans 3.49 3.34 2.99 3.34
The Co-operative Bank - First Home Special - 2.09 - -
The Co-operative Bank - Owner Occ 4.40 2.29 2.59 2.79
The Co-operative Bank - Standard 4.40 2.79 3.09 3.29
TSB Bank 5.34 3.09 3.29 3.45
TSB Special 4.54 2.29 2.49 2.65
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 3.09 3.29 3.39
Westpac - Offset 4.59 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 2.29 2.69 2.79
Median 4.55 2.73 2.99 2.80

Last updated: 12 April 2021 8:56am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com