Don’t expect any Government handout for mortgage repayment stress

However, it is unlikely the Government will giving any handouts in this month's Budget to mortgage borrowers struggling with repayments as they roll on to higher interest rates.

Twelve consecutive hikes in the official cash rate (OCR) to 5.25% has helped house prices come off the 2021 highs and the RBNZ is widely expected to raise the OCR another 0.5% later this month, to help bring house prices down further.

The bank’s latest Financial Sustainability Report says prices are within the range of fundamental values suggested by some of the metrics it monitors, but the overall balance suggests prices remain somewhat overvalued.

“In the near term prices may continue to soften, given the level of interest rates, the ongoing completion of houses under construction, and weak market sentiment.