You might have seen the headlines—floating interest rates have dropped across most of the main banks following the recent OCR review.
That’s great news... but if you're like most Kiwis with a fixed home loan, you might be wondering: “So what?”
Let’s unpack what it really means for you, especially if you’ve got a fixed rate coming up for renewal.
Floating rates have dropped - what about fixed?
Yes, the big banks have cut their floating (variable) rates, but most borrowers are on fixed terms—often one or two years—so the immediate impact might feel pretty minimal.
That said, dropping floating rates are usually a sign of things to come.
So far, none of the banks have moved on fixed rates, and honestly, we’re not surprised. Most of them had already priced in the 0.25% OCR cut, which was widely expected.
In fact, we saw some rate drops back in February after the last review, so any movement in fixed rates over the next couple of weeks is likely to be minimal.
What should you do if your fixed rate is about to expire?
If your loan has just rolled off a fixed rate—or will do in the next couple of weeks—it’s a good time to pause and think about your next move.
The options are;
Fix now at current rates (still sitting around 5% for 1-year terms)
Float for a few weeks in the hope of a small rate drop
The difference might not be massive either way, but every little bit counts—especially in this economy. And if you’re floating right now, locking in a fixed rate could offer a bit of relief and certainty.
Make sure your fixed rate aligns with your financial plan
It’s not just about chasing the lowest rate—it’s about making sure your loan structure fits your goals.
For example:
Planning to sell in the next 6–12 months? You probably don’t want to fix for 2+ years and risk break fees.
Looking for stability in repayments? A short-term fixed rate might give you the balance you need.
Expecting life or income changes soon? Let’s factor that into your loan decisions now.
Get in touch with us at My Mortgage to make a plan, and book a call below with one of our advisers 👇