Finance Matters

03/09/2026

GoodReturns | NZ’s financial adviser news-item centre https://www.goodreturns.co.nz/article/ocr-up-what-the-rbnz-said-2?utm_source=GR&utm_medium=email&utm_campaign=%5BBREAKING+NEWS%5D+OCR+up

27/07/2026

The '87 Effect – are we about to get the same in housing?

Weekly Media Links Mon 27 July 2026 - NZ Property Investors Federation https://buff.ly/vSurtAH

I came across this fascinating podcast from Craigs Investment Partners, looking at how the ’87 stock market crash shaped a generation of investors. It’s only 10 minutes long and well worth your time.

I was around for the ’87 crash, remember it well. I too bought Chase shares and lost the lot (IYKYK). I was working as a tiler at the time and the last job I did was for a firm that went bankrupt – never got paid. So that period had a big impact on me and loads of other Kiwis. What I didn’t realise was the true scale of our crash compared others.

While the US, UK & Japanese stock markets all crashed, it was only by around a third and they’d all recovered within two years. In NZ, we dropped by over 50% and didn’t recover for nearly a decade. That event was a major factor in thousands of Kiwis avoiding shares and investing in property to grow wealth and retirement security.

Hearing this story made me think: could the Covid boom & bust housing market have the same effect on this generation? It was described by Bloomberg as ‘The World’s Most Extreme Housing Boom’, and they concluded that New Zealand is a “tiny, but extreme” example of what happens when a housing boom goes into reverse.

I’ve been struck at how many people I cross paths with have a tale about how they bought a house or rental at or around the top of the market and are now sitting on a paper loss. Often with a large mortgage to feed. I’m curious to know how many people are sitting in negative equity and whether that number is large enough to have an “’87 Effect”.

Weekly Media Links The headlines this week all point to one question: is the property market entering a new era? This week we look at why flat rents might actually be good news in the long run, how NZPIF is helping shape the media conversation around rental housing, why Opportunity is becoming a par...

08/07/2026

The RBNZ Monetary Policy Committee today reached consensus to increase the OCR by 25 basis points to 2.50%.

Following the partial reopening of the Strait of Hormuz, global oil prices have fallen markedly. Other petrochemical prices have also moved lower. As a result, near-term inflation pressures have eased.

Although energy prices have decreased, the effects of the shock will linger for some time and the outlook for medium-term inflation pressures remains uncertain. The stance of monetary policy is calibrated to bring inflation back to target without causing unnecessary economic instability.

Global growth has been resilient to the effects of tariffs and conflict in the Middle East, largely because of strong AI-related investment and spending on defence and economic security. Headline inflation in New Zealand’s trading partners has increased but is expected to ease to close to 2% in 2027.

Markets expect global policy rates to increase above pre-conflict levels, as central banks may need to respond to persistent energy-driven inflation pressures.

New Zealand’s economic recovery was underway before the Middle East conflict, but lost momentum in the June quarter as the oil shock weighed on economic activity.

Growth is expected to resume in the September quarter as these effects fade and confidence improves. Over the medium term, inflation returning to the 2% target mid-point will lift household purchasing power and help support a sustained recovery in growth and employment.

The outlook for medium-term inflation pressures depends on the extent to which recent cost increases feed through into higher prices.

Spare capacity in the economy is expected to limit firms’ ability to pass on higher costs, meaning many businesses may need to absorb them in margins. However, some firms may look to rebuild margins as demand recovers. If sustained, a lower exchange rate could also add to medium-term inflation pressures.

With inflation still above target and economic activity expected to strengthen, some further reduction in monetary stimulus is likely to be required to return inflation to the 2% target mid-point.

Future OCR decisions will depend on how incoming data, price-setting behaviour, and the strength of economic activity affect medium-term inflation pressures.

The Reserve Bank has increased the OCR. Here's what it said.

03/07/2026

Americans are escaping the U.S. for New Zealand where house prices have hit a new low—but only wealthy Americans with $3 million spare can invest

Americans are grabbing their passports and fleeing the country in hopes of leaving the nation's problems behind. And more are flocking to the picturesque country of New Zealand, famous for its landscapes that served as the backdrop for Lord of the Rings and Avatar. Home prices in the nation are falling, making way for potential bargains—but only the wealthiest foreigners can afford to move there.

New Zealand home prices fell for the third straight month in June, nearly hitting a three-year low. Home prices slipped 0.2% in June after falling a revised 0.3% in May, according to property consultancy Cotality's Home Value Index. And values are now down 0.8% over the past three months, reaching their lowest level since July 2023.

For Americans dreaming of an overseas escape, falling home prices might make New Zealand look more attainable than it has in years.

But the cooling market doesn't mean it's suddenly open season for foreign buyers. Interested American (and any non-native) buyers will have to cough up $3 million to qualify for homeownership.

Americans are flocking from the U.S. at a record, mirroring the Great Depression
New Zealand has become a hotspot for Americans looking to escape from their country's problems.

In 2025, the U.S. recorded a net negative migration of between 10,000 and 295,000, according to The Brookings Institution. America hasn't faced negative net migration in the U.S. since the Great Depression, nearly a century ago.

Immigration crackdowns, high cost-of-living, economic uncertainty, and a volatile political climate are pushing more to look overseas. Right after President Trump won his second term in 2024, the search "Move to New Zealand" was even trending on Google. Now, more and more Americans are eyeing up new lives south of the equator.

New Zealand has received a surge in interest from foreign investors since expanding its rules for migrants. Applications for New Zealand's Active Investor Plus "golden visa" program have surged several times over since eligibility requirements were loosened last year. And Americans account for the largest share of applicants; between April 1 last year and June 11 2026, the United States submitted 252 applications representing 766 people looking to move to New Zealand.

However, strict immigration rules, the country's geographic isolation, and the steep costs of relocating mean only wealthy Americans can realistically make the move.

It takes $3 million for Americans to buy a home in New Zealand
New Zealand's previous regulations required that foreign homebuyers live in the country for six months before they were even allowed to consider purchasing property. Many wealthy clientele were turned off by the rule, which all but eliminated the prospect of buying a vacation home. But now the scenic country is courting foreign investors to help revive its struggling economy.

12/05/2026

First home buyers continue leaping into the housing and mortgage markets - TMM Online https://buff.ly/v8NcbYT

The latest Cotality-Westpac First Home Buyer report shows they’ve bought 24,800 homes over 12 months to the end of the first quarter of this year – the highest annual total since the third quarter of 2021, near the market peak.

They made up 27.5% of all property purchases, just shy of the record 28.2% share at the end of last year.

This strength of first home buyers is right across the country, with market shares running above long-term averages since 2005.

For example, across the wider Wellington area, first home buyers account for 37% of activity, about 8% above the average. Hamilton has also been strong, alongside Napier, Gisborne, South Waikato and Waikato districts.

For those looking to get into their first home, lower mortgage rates have made it much easier to get a foot on the property ladder.

In most parts of the country (excluding Auckland), minimum mortgage payments are now about $130/month lower than they were this time last year, and they’re a whopping $820/month lower than they were back in 2024.

In Auckland, where first home prices tend to be much higher, the fall in mortgage costs has been even larger.

Minimum mortgage payments are now around $180/month lower than they were this time last year, and they’re around $1,100/month lower than they were back in 2024.

First home buyers have had to pay a little more for a home, though with a median price of $720,000 which is just $20,000 less than the first quarter of 2022’s peak of $740,000.

First home buyers are also getting more active across the value spectrum, the report says. For example, in the middle 40% of the market by value, their share rose from just 21% in 2015 to almost 29% in 2025 and a little higher over the first quarter of this year.

More than half of first home buyer loans are done at less than a 20% deposit and Westpac’s lending records show a recent average LVR if 81%, up from less than 77% in 2024.

The average age of first home buyers has also dropped slightly, with an average of 35 over the past year, down from a typical age of 36 in 2024.

06/05/2026

First‑home buyers take lead in softer NZ property market https://buff.ly/Kz1DNS5

First‑home buyers remain key demand engine
Despite the softer backdrop, Alexander notes that “first-home buyers continue purchasing”. In the April survey, a net 26% of agents reported more first‑home buyers in their area, making this cohort one of the few bright spots since the turnover recovery began in early 2023. Many are using accumulated deposits, lower prices, and better credit availability to enter the market, even as higher mortgage rates cap how far they can stretch.

NZBA lending data back this up. In the six months to December, total new home lending rose 17.5%, with 70,811 new loans written and 24.4% going to first‑home buyers.

Investors retreat as buyer’s market deepens
By contrast, property investors are stepping back. A net 50% of agents say they are seeing fewer investors in the market, while a net 27% report more investors bringing stock to sell than three months ago. Higher holding costs, softer capital‑gain expectations, and tax uncertainty all appear to be biting.

Survey responses underline just how cautious this group has become: 58% of agents say “nothing is motivating investors to make a purchase”, with only a minority citing bargain‑hunting.

Alexander concludes, “We are solidly in a buyer’s market,” with a net 45% of agents judging vendors to be the more motivated party in negotiations.

05/05/2026

Auckland market steadies as ‘quiet confidence’ returns https://buff.ly/yX0zgub

Auckland’s residential market tracked a familiar seasonal pattern in April, with softer activity but underlying signs of stability.

“April is often a difficult month to read clearly, and this year is no exception,” Barfoot & Thompson managing director Peter Thompson (pictured) said in a media release, citing the impact of school holidays, Easter, and Anzac Day on sales.

Average prices eased from March’s peak, but the April average of $1,131,246 was still slightly higher than a year earlier, while the median of $955,250 sat 2.3% above April 2025 despite a month‑on‑month fall.

Thompson said the agency is “seeing some monthly movement, however both measures indicate pricing remains relatively steady overall, with short-term variation expected at this time of year.”

Sales volumes dropped to 688 in April, down from 1,262 in March and below the same month last year, broadly in line with traditional autumn slowing.

Listings surge gives buyers more choice
One standout for April was supply. New listings climbed to 1,744 – the highest April level in more than a decade – pushing total available stock to 6,356 homes, slightly above a year earlier and giving active buyers more options across price brackets.

Transactions under $750,000 made up 22% of sales, while 6.4% were above $2 million, signalling activity at both ends of the market as well as the mid‑range family segment.

Rural and lifestyle property across Northland and Greater Auckland also remained firm, with more than $50 million of sales and the busiest April in five years.

28/04/2026

First‑home buyers drive lending rebound as borrowers stay ahead on repayments

New Zealand’s home loan market ended 2025 on a stronger footing, with first‑home buyers firmly in the mix and many borrowers getting ahead on their mortgages, according to the New Zealand Banking Association’s latest retail banking insights.

Total new home lending in the six months to December rose 17.5% compared with the first half of the year, with 70,811 new home loans written, up from 60,249. Almost a quarter of these – 24.4% – went to first‑home buyers, a similar share to the previous six months, even as the average first‑home buyer loan size climbed 3.4% to $524,850.

NZBA chief executive Roger Beaumont said the figures challenge the idea that new entrants are locked out.

“A few years ago, first-home buyers were widely reported as being locked out of the housing market. It’s encouraging to see first-home buyers taking advantage of the current housing market and cheaper loans compared to the post‑COVID highs,” Beaumont said.

The average value of all new home loans edged down 3% to $392,519, suggesting some buyers are targeting more affordable stock or trimming borrowing capacity as mortgage rates sit higher than pre‑COVID levels.

More borrowers ahead on repayments, arrears contained
The NZBA data also point to improving household buffers. By the end of 2025, 42.9% of home loan customers were paying more than the minimum required, up from 40.3% in the prior period, while just 1.4% were behind on repayments, broadly unchanged.

Beaumont said this illustrates a solid level of money management.

“The fact that over 40% of people with a home loan are ahead on their repayments shows a high level of financial capability among New Zealand homeowners. Managing your money well, especially during a time of economic challenges, is a great skill to have,” he said.

Banks granted hardship status to 6,158 customers over the half, an 8.3% decline, even as applications rose modestly. That suggests proactive support and refinancing options are still in play for stressed borrowers.

Fixed‑rate tilt and digital shift reshape broker conversations
Rate‑mix data underline a clear preference for certainty. At December, 60.7% of home loans were on fixed rates only, 17.7% on variable and 21.6% on a mix. Nearly 18% of loans moved from variable to fixed over the half, a shift Beaumont said “may reflect a recognition that interest rates were becoming less likely to fall further as economic conditions changed.”

At the same time, nearly 80% of bank customers are now registered for online or mobile banking, with just 1.7% of all transactions going through ATMs.

21/04/2026

Middle East turmoil deepens rate dilemma for New Zealand

New Zealand’s economic outlook has grown murkier as the Middle East conflict sends oil prices higher and businesses and households pull back on spending, according to fresh analysis from Kiwibank and ASB.

Both banks highlight how repeated closures of the Strait of Hormuz and whiplash in ceasefire talks are fuelling market volatility just as key local indicators land.

Kiwibank economists Jarrod Kerr and Alexandra Turcu note that Kiwi firms and households have largely absorbed surging transport costs in the midst of a cost‑of‑living squeeze, draining savings and profit margins. They argue that New Zealand is unlikely to bounce back quickly from the shock, saying “we aren’t expecting a swift rebound, but more likely an achingly slow recovery once the war is over.”

ASB’s latest Economic Weekly makes a similar point, warning that “Uncertainty is economic paralysis.” In practice, the bank says businesses and consumers are taking longer to commit to major spending, lifting investment hurdles and dampening growth even before any full fuel‑supply disruption is felt.

Inflation pressure rises as growth softens
Both reports underline the challenge this poses for the Reserve Bank of New Zealand (RBNZ). Headline inflation is expected to lift again in 2026 as higher food, fuel, to***co and housing costs flow through. ASB expects annual CPI inflation to move back above 4% over the coming year, while also forecasting a contraction in GDP in the June quarter and a higher jobless rate.

Kiwibank expects March‑quarter CPI to come in around 0.9%, keeping annual inflation near the 3.1% pace recorded at the end of 2025, but stresses that only a fraction of the quarter captures the recent oil shock.

ASB expects inflation pressure to re‑intensify later in 2026, even as Kiwibank’s March‑quarter CPI forecast suggests annual inflation will initially hold near 3.1%. Both banks see the June data as the real test of how deeply higher energy costs are feeding into prices.

RBNZ tightening path in focus
Against this backdrop, ASB’s central case has the OCR on hold until spring, then rising in a series of quarter-point moves to around 3.25% by early 2027. Yet the bank cautions that “None of those paths are without risk and potential economic costs.” Any mis‑step risks either entrenched inflation or an unnecessarily sharp slowdown.

For now, both institutions suggest the central bank will be forced to balance elevated near‑term inflation against growing spare capacity in the economy, as New Zealand awaits clearer readings from this week’s CPI and business confidence surveys.

07/04/2026

RBNZ split over how fast to lift rates as oil shock hits fragile economy https://buff.ly/2HBeBDq

Oil shock stirs fresh uncertainty for Kiwi mortgage borrowers