A short week, but still enough movement to keep borrowers and buyers watching closely. Fixed rates nudged higher again, Australia added fresh inflation pressure, and while the property market remains steady, rental data is showing a slightly softer edge than many expected.
Rate changes
ASB joined BNZ and Kiwibank in lifting fixed rates. ASB lifted its 1 year special to 4.65% and 2 year to 5.25%, while keeping 6 months at 4.49%. BNZ and Kiwibank both made similar moves earlier in the week as wholesale costs continue pushing higher.
Wholesale rates are driving this more than OCR expectations
NZ’s one year swap rate rose another 14 basis points this week, with banks openly pointing to wholesale funding pressure rather than any immediate OCR move.
Australia surprised markets with hotter inflation
Australia’s annual inflation lifted to 4.1%, above expectations, which has pushed attention firmly onto next week’s Reserve Bank of Australia review. Markets are leaning toward another tightening move. If Australia stays hawkish, wholesale pricing here is unlikely to ease quickly.
First home buyers are still doing plenty of the heavy lifting
They made up 27% of purchases nationally in Q1, and around 30% in Auckland, which remains a standout trend.
Rental pressure has softened slightly
Stats NZ shows rents down 0.4% annually, while MBIE bond data recorded a 1.6% drop, even though vacancy remains tight.
Yields are quietly improving
National gross rental yields have lifted to 3.9%, the strongest they’ve been since 2015, which is keeping investors interested again.
That’s the TLDR this week.
For once, and at least for now, we’re sitting in a slightly better spot than what’s unfolding across the ditch. That doesn’t mean we’re in the clear, just that the pressure is building a bit faster over there. So while things here still feel a bit unsettled, it’s a reminder that comparatively, we’ve got a touch more breathing room.
Disclaimer: This article is general market commentary only and is not financial advice. Property markets, lending criteria, and interest rates can change quickly, so always do your own research and seek advice based on your own circumstances before making financial decisions.