NZ Mortgage Rates: Current Rates Compared
The lowest 1-year fixed mortgage rate from a major NZ bank is currently around 5.59%, with most banks sitting between 5.59% and 5.89% (bank websites, February 2026). Rates have been trending down since mid-2025 as the OCR has fallen from its peak of 5.50%.
Use the table below to compare rates across all major lenders. These are standard, advertised rates. Your actual rate may be lower if you negotiate or meet specific criteria (such as a low LVR).
Current NZ mortgage rates
All rates are per annum. These are standard advertised rates for owner-occupied lending as at 28 February 2026 (bank websites). Rates change frequently. Check your lender's website for the latest.
Fixed rates
| Lender | 6 months | 1 year | 18 months | 2 years | 3 years | 5 years |
|---|---|---|---|---|---|---|
| ANZ | 6.15% | 5.69% | 5.69% | 5.59% | 5.69% | 5.99% |
| ASB | 6.15% | 5.69% | 5.69% | 5.59% | 5.69% | 5.99% |
| BNZ | 6.15% | 5.59% | 5.65% | 5.59% | 5.69% | 5.99% |
| Kiwibank | 5.99% | 5.59% | 5.59% | 5.55% | 5.65% | 5.89% |
| Westpac | 6.15% | 5.69% | 5.69% | 5.59% | 5.69% | 5.99% |
| TSB | 6.09% | 5.69% | 5.65% | 5.59% | 5.69% | 5.95% |
| SBS | 6.09% | 5.65% | 5.59% | 5.55% | 5.65% | 5.89% |
| Co-operative Bank | 6.09% | 5.65% | 5.59% | 5.55% | 5.65% | 5.95% |
Floating rates
| Lender | Floating rate |
|---|---|
| ANZ | 7.34% |
| ASB | 7.34% |
| BNZ | 7.34% |
| Kiwibank | 7.20% |
| Westpac | 7.34% |
| TSB | 7.25% |
| SBS | 7.20% |
| Co-operative Bank | 7.25% |
Rates are indicative as at 28 February 2026 (bank websites). These will be updated by the Forge Money rate scraper once live. Always confirm with your lender before making decisions.
The sweet spot right now is the 1-year to 2-year fixed range, where most lenders are clustering between 5.55% and 5.69%. The shorter fixed terms (6 months) carry a premium because banks expect rates to keep falling, and they don't want to lock you in cheaply for a short period then have you refix lower. The 5-year rates are higher because banks build in a margin for the risk of rates moving against them.
Fixed vs floating rates
A fixed rate locks your interest rate for a set period (6 months to 5 years). Your repayments stay the same regardless of what happens to the OCR or wholesale rates during that period. A floating rate moves up and down with market conditions, typically tracking the OCR with a margin.
When fixed rates tend to work well
Fixed rates make sense when you want certainty on your repayments, when rates are low and likely to rise, or when you're on a tight budget and can't absorb payment increases. Right now, with the OCR falling and market expectations of further cuts in 2026, fixing for a shorter term (1 year) lets you lock in a decent rate and potentially refix lower in 12 months (RBNZ).
When floating rates tend to work well
Floating rates suit people who expect rates to fall further, who want flexibility to make extra repayments without penalty, or who plan to sell or restructure soon. The downside is that your payments change, sometimes quickly, and the floating rate is always higher than the best fixed rates. At 7.20% to 7.34% versus 5.55% to 5.69% for 2-year fixed, the gap is significant right now.
Splitting your mortgage
Many borrowers split their mortgage across multiple fixed terms (for example, one-third on 1-year fixed, one-third on 2-year fixed, one-third on 3-year fixed). This is sometimes called a ladder strategy. It reduces your risk because you're not exposed to a single refix date. When one portion comes up for renewal, you refix it at whatever rate is available, while the other portions continue at their locked-in rates.
How the OCR affects mortgage rates
The Official Cash Rate (OCR) is the interest rate set by the Reserve Bank of New Zealand (RBNZ). It's the rate at which commercial banks borrow from and lend to the RBNZ overnight. When the RBNZ changes the OCR, banks adjust their lending and savings rates accordingly, though not always by the same amount or at the same speed.
The OCR peaked at 5.50% in May 2023 and the RBNZ held it there until August 2024, when it started cutting. As of February 2026, the OCR has come down significantly. Wholesale swap rates (the rates banks use to price fixed mortgages) have also fallen, which is why fixed mortgage rates have dropped from their 2023-2024 peaks of 7%+ to the current 5.5% to 6% range (RBNZ).
Fixed mortgage rates don't track the OCR directly. They're based on swap rates, which reflect market expectations of where the OCR will be over the fixed period. If the market expects more OCR cuts, swap rates (and therefore fixed mortgage rates) can fall before the RBNZ actually cuts.
Floating rates track the OCR more closely. When the RBNZ cuts the OCR, floating rates typically drop within weeks.
Breaking a fixed rate
If you're on a fixed rate and want to switch to a different rate or lender before your fixed term ends, you'll face a break fee. The size of this fee depends on the difference between your current fixed rate and the rate the bank can now get for the remaining term, multiplied by your loan balance and remaining time.
Break fees can range from a few hundred dollars to tens of thousands, depending on your balance and how much rates have moved. If rates have risen since you fixed, your break fee may be zero (because the bank benefits from re-lending at higher rates). If rates have fallen since you fixed, the break fee can be substantial.
Before breaking, ask your bank for a break fee estimate. Compare it against the savings from the new rate over the remaining term. Sometimes it's worth paying the fee. Sometimes it's better to wait until your fixed period ends.
When breaking might make sense
- You fixed at a high rate (say 7%+) and current rates are much lower
- Your break fee is small relative to the interest savings
- You're selling the property
When breaking probably doesn't make sense
- You're close to the end of your fixed term anyway
- The break fee exceeds the interest savings
- Rates have only dropped slightly
Worked example: Total interest on $500,000 over 30 years
This example shows how much total interest you'd pay on a $500,000 mortgage over 30 years at different rates, assuming principal and interest repayments with no extra payments.
| Interest rate | Monthly repayment | Total interest over 30 years | Total cost (principal + interest) |
|---|---|---|---|
| 5.00% | $2,684 | $466,279 | $966,279 |
| 5.50% | $2,839 | $521,872 | $1,021,872 |
| 5.75% | $2,918 | $550,395 | $1,050,395 |
| 6.00% | $2,998 | $579,355 | $1,079,355 |
| 6.50% | $3,160 | $638,637 | $1,138,637 |
| 7.00% | $3,327 | $697,544 | $1,197,544 |
The difference between 5.50% and 6.50% on a $500,000 loan over 30 years is $116,765 in total interest, or about $321 per month. That's why even a small rate difference matters over the life of a mortgage.
Of course, most people don't hold the same rate for 30 years. You refix every 1 to 5 years, so your actual cost depends on the rates available at each refix point. But the example illustrates why negotiating even 0.10% to 0.20% off your rate is worth the effort.
Common questions
What is the best mortgage rate in NZ right now?
As at February 2026, the best standard advertised rates from major banks are around 5.55% for a 2-year fixed term, offered by Kiwibank, SBS, and Co-operative Bank (bank websites). However, banks sometimes offer lower rates for new lending, low-LVR borrowers, or through mortgage brokers. It's worth asking your bank or broker for their best rate rather than accepting the advertised one.
Is fixed or floating better right now?
With floating rates at 7.20% to 7.34% and the best fixed rates at 5.55% to 5.69%, fixed is significantly cheaper right now. The question is which fixed term to choose. If you expect the OCR to keep falling, a shorter fixed term (1 year) lets you refix sooner at potentially lower rates. If you want certainty, a longer term (2 to 3 years) locks in the current rate for longer. The answer depends on your risk tolerance and cash flow needs (RBNZ).
When is the best time to refix my mortgage?
Your bank will typically contact you 30 to 60 days before your fixed rate expires. You can lock in a new rate up to 30 days before your current rate ends with most banks. If rates are falling, it can pay to wait until closer to your expiry date. If rates are rising, locking in earlier protects you. You can also shop around and move to a different bank at refix time, though switching involves legal and valuation costs (typically $500 to $2,000).
How does the OCR affect my mortgage rate?
The OCR influences mortgage rates indirectly. When the RBNZ raises the OCR, banks increase their lending rates. When the RBNZ cuts the OCR, lending rates eventually fall. Fixed rates are based on swap rates (which reflect expected future OCR movements), not the current OCR. Floating rates track the OCR more closely. A 0.25% OCR cut doesn't always translate to a 0.25% drop in your mortgage rate (RBNZ).
Can I negotiate my mortgage rate?
Yes, and you almost always should. Banks advertise a standard rate, but they have discretion to offer lower rates, especially for borrowers with strong incomes, high equity (low LVR), or large loan balances. Having a pre-approval from a competing bank gives you a concrete offer to negotiate with. Mortgage brokers can also access rates that aren't publicly advertised. Even 0.10% off a $500,000 mortgage saves about $500 per year.
What is LVR and why does it matter?
Loan-to-Value Ratio (LVR) is your mortgage balance as a percentage of your property's value. If your home is worth $800,000 and your mortgage is $640,000, your LVR is 80%. The RBNZ sets LVR restrictions that limit how much banks can lend at high LVRs. Most owner-occupiers need at least a 20% deposit (80% LVR), though first home buyers may qualify for a 10% or even 5% deposit through certain schemes (RBNZ, Kainga Ora). Borrowers with lower LVRs (more equity) typically get better interest rates.
How do I compare mortgage offers properly?
Don't just compare the interest rate. Look at the total cost including fees (application fee, valuation fee, legal fees, break fees). Check whether the rate is a special new-lending rate that reverts to a higher rate after the fixed period. Compare the cash contribution or incentive some banks offer (which can offset switching costs). And consider the flexibility: can you make lump sum payments, increase your repayments, or access a revolving credit facility? The cheapest rate isn't always the best deal.
What happens to my mortgage rate when I refix?
When your fixed period ends, your bank will offer you a new rate for your next fixed term. This new rate is based on whatever rates are available at that time, not your previous rate. If rates have risen, you'll pay more. If rates have fallen, you'll pay less. You're not locked in to the same bank. You can shop around and switch lenders at refix time, though switching costs ($500 to $2,000 typically) need to be factored in.
What to do next
- First home buyer guide: Everything you need to know about buying your first home in NZ
- Mortgage calculator: See how different rates affect your repayments (coming soon)
- KiwiSaver first home withdrawal: How to use your KiwiSaver to buy a home
- PAYE calculator: Check your take-home pay to understand your borrowing power
Last updated: 28 February 2026. Sources: Bank websites (anz.co.nz, asb.co.nz, bnz.co.nz, kiwibank.co.nz, westpac.co.nz, tsb.co.nz, sbs.co.nz, co-operativebank.co.nz), RBNZ (rbnz.govt.nz). Rates are indicative and subject to change. This is financial information, not financial advice.
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This is educational content, not financial advice.