Why New Zealand Mortgage Rates Are Increasing
From Aaron’s YouTube: “They all lowering that short term one but the rest of the fixed interest rates are going up, up, up-”
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Posted 17 December 2025
The short version
- All major NZ banks have now increased their longer-term fixed mortgage rates.
- The latest increase was 0.30% on longer-term fixed rates.
- Short-term rates may stay flat after these recent increases.
- These rate rises come at an inconvenient time for many borrowers.
The latest rate changes
The last of New Zealand's major banks has now increased their mortgage rates, with a 0.30% jump on their longer-term fixed rates. This follows similar moves by other banks in recent weeks, meaning all major lenders have now pushed their fixed rates higher.
Aaron notes this is particularly unwelcome news coming into the holiday season. While the short-term rates might stabilise now, borrowers facing renewal in 2024 should prepare for higher repayments than they may have budgeted for.
What this means for borrowers
For those with fixed terms expiring soon, these increases will mean noticeably higher monthly repayments. The 0.30% rise might sound small, but on a $500,000 mortgage, that's an extra $1,500 per year in interest costs.
First-home buyers and homeowners looking to refinance will need to factor these higher rates into their budgets. While short-term rates have remained relatively steady for now, the upward trend on longer terms suggests the era of ultra-low rates has passed.
Looking ahead
Aaron suggests these increases may represent the last of the current round of rate rises, with things potentially levelling off in the short term. However, the longer-term outlook remains uncertain, and borrowers shouldn't assume rates will quickly return to previous lows.
The key takeaway is to plan conservatively - either lock in rates now if you're worried about further increases, or consider shorter terms if you believe rates might decrease again in future. An experienced mortgage adviser can help analyse which approach suits your situation best.
This is general information, not personalised financial advice. For advice on your situation, talk to Aaron.
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