Mortgage holders still riding lower interest rates
Borrowers paid $4.783 billion in interest on $397.4 billion in residential mortgages outstanding at the end of the June quarter this year, the latest Reserve Bank figures show.
Monday, August 3rd 2026, 8:54AM
by Sally Lindsay
The amount owed was up 1.2% from $392.6 billion in the first quarter and up 6% from $375.8 billion in the second quarter of last year.
However, the interest paid on the mortgage debt was down 12% on the $4.750 billion owed at the same time last year, even though mortgage rates have been increasing.
New mortgage lending increased to $27.3 billion in the second quarter, up 6.4% from $25.6 billion last quarter and up 1.5% than in the same quarter last year when it sat at $26.9 billion.
The increase in the value of outstanding mortgage lending (net credit growth) during was $4.9 billion
This is 4.2% lower than the first quarter, when it was $5.1 billion.
Repayments of loans in full was $15.2 billion in the quarter, up 6.4% from $14.3 billion in the first quarter and up 2% from $14.845 billion in the second quarter of last year.
Of the total existing residential mortgage lending, 16% is interest only (including revolving credit) whereas the remaining, 84% per cent, is principal and interest.
Despite increasing interest rates, borrowers increased extra mortgage payments to $4.760 billion to create a buffer and get ahead of their scheduled repayments, compared to $4.127 billion in the first quarter and $4.633 billion in the second quarter of last year.
Net mortgage write-offs totalled $11 million in the second quarter, the same as the first quarter and up from $6 million in the same quarter last year.
The share of existing low equity lending increased to 10% for the second quarter, up from 9.6% in the first quarter, while that lending on interest only repayments rose to 4.7% per cent the quarter, up from 4.6% in the first quarter. Low equity lending on principal and interest repayments increased to 11%.
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