The New Zealand property market appears to be cooling faster than expected, which should take some pressure off bank funding costs. This according to big bank, Westpac, chief executive David McLean.

House price growth across New Zealand is likely to slow more than predicted in 2017 – about a three to four per cent rise is expected, nearly half of what was forecasted - while the previously overheated Auckland market appears to be cooling quite quickly.

Both Real Estate Institute of New Zealand (REINZ) and Quotable Value (QV) report that property prices in areas like Auckland, Hamilton and Tauranga – previous hotspots – have been flat for about six months.

McLean said it’s likely that homeowners will face another three to six months of upward pressure on retail mortgage rates, despite economists forecasting no movement in the official cash rate for at least a year.

Mortgage rate rises hit hard

A recent survey undertaken by the Bank of New Zealand shows at least 70 per cent of the 2,000 borrowers surveyed expect a rise in interest rates this year.

While it appears most borrowers could cope with a small increase in mortgage repayments, a significant minority are ill-prepared for a rise in interest rates, and would face longer term financial harm, the survey uncovered.

The survey results showed that at least one in five respondents would ask their bank to extend their mortgage term or tap into retirement savings to cope with higher mortgage repayments, quick-fix solutions that could cost them more in the long run.

With a rise in interest rates predicted, it’s important that homeowners review their household spending and decide whether to fix all or some of their mortgage while interest rates remain relatively low.

Mortgage Express urges its clients to seek professional mortgage advice before making any decisions, by getting in touch with a mortgage adviser to assist with a financial review.

Mortgage Express April Results

Top Advisers by Total Settled Loan $ for Apr 2017

Charlie Sun

Suzanne Isherwood

Jenny Cheevers

Di Dunn

Sue Clydesdale

Top Harcourts Franchises by Settled Loan Units for Apr 2017

Gold Real Estate Group

Cooper & Co Real Estate

BCRE

Marlborough Real Estate

Monarch Real Estate

Top Harcourts Referrers by Settled Loan Units for Apr 2017

Selena Andreassend – Papanui

Craig Searle – Blenheim

Rosie Houghton – Takapuna

Chris Campbell – Ilam

Therese O’Sullivan – Wellington City