RBNZ: half of all mortgages to reprice over next six months

About half of all mortgages will reprice over the next six months, given the recent propensity for borrowers to fix for only six months at a time in the expectation of falling interest rates.

Ässistant Reserve Bank governor Karen Silk told journalists that the average mortgage rate currently is about 6.2% and that borrowers will be rolling over only rates of about 5.7%.

RBNZ’s latest monetary policy statement said that declining wholesale interest rates since its last statement in November in response to the falling official cash rate (OCR) and weaker-than-expected economic activity have fed through into lower mortgage and term deposit rates.

“The average interest rate on outstanding mortgages has now peaked and is expected to decline over the next 12 months as borrowers refix their mortgage interest rates at lower levels,” the MPS said.