Mortgage Interest Rates Forecast 2024 - 2025
First Rate Cut in November?
Good news for homeowners and prospective buyers: mortgage interest rates are expected to start trending downwards in the near future. According to the latest forecasts from the Reserve Bank of New Zealand (RBNZ), the first rate cut could come as early as November 2024.
The OCR and Mortgage Rates
The Official Cash Rate (OCR) is the benchmark interest rate set by the RBNZ. Changes to the OCR directly impact mortgage interest rates. The OCR has been at 5.5% since May 2023, the highest level since 2008. However, the RBNZ has signaled its intention to start lowering the OCR in the coming months.
Reasons for Optimism
There are several reasons to be optimistic about the future of mortgage interest rates. First, inflation is starting to cool, indicating that the RBNZ may be able to ease its aggressive monetary tightening stance. Second, the global economy is slowing down, which could reduce pressure on the RBNZ to keep interest rates high. Third, the housing market is showing signs of cooling, which could also lead to lower mortgage rates.
What's Next?
Stay tuned for further updates on the mortgage interest rate forecast. The next OCR review is scheduled for November 9, 2023. If the RBNZ cuts the OCR as expected, it would be the first step towards lower mortgage interest rates.
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