Long wait for rate cut

The good news though is that in the past week there have been few changes to mortgage rates and none of the banks have moved.

However, some of the second tier banks which tend to offer lower rates than their big brothers have pushed some rates up a little thus closing the gap between themselves and the big four.

In particular Kiwibank and Bank Direct have increased rates during the week.

In the highly-competitive two-year fixed rate market most lenders have rates above 8% and banks are in the 8.10-8.20% range.

Looking ahead the view from economists is that another OCR hike remains in the mix, especially as last week’s housing figures from the Real Estate Institute were quite strong.

Indeed there is a view that with the number of days to sell a house decreasing that the housing market is again picking up speed.

Currently the markets have moved to price in around a 50% chance of a rate rise in January.

This also means that next year’s much-anticipated cuts are a long way off, indeed the BNZ suggests not until September next year at the earliest.

It also makes some interesting predictions that the next cyclical low point for the OCR is likely to be 6% rather than the more usual 4.5%. This means that when rates do fall they may not go as low as in previous times.