“Prices are continuing to go up, driven by immigration, the strong domestic economy, and people seeking the capital gains available in the property market.

“The latest interest rate rise, once it flows through, will add approximately $30 a month to a mortgage of $150,000. That is insignificant when compared to the capital gains, in many cases tens or hundreds of thousands of dollars, people have made over the past few years on their homes and investment properties. The difference in these numbers helps explains why people continue to invest in residential property.

“We continue to advise our clients, however, to look carefully at the reasons they are buying a house and assess their overall financial situation in terms of how they would cope with a rise in their mortgage rate or a slower property market.

“We also realise falling housing affordability in New Zealand is a growing problem and we support moves, including a Government select committee, to address this.”

Staniland added: “For existing homeowners, however, the effect of the latest rise in interest rates will depend on their circumstances. Around 85% of home mortgages are fixed and only 30% of those are due for renewal in the coming 12 months. So that means that 70% of fixed mortgages will be unaffected for at least another year by the latest hike in the Official Cash Rate”