Positive news for borrowers ahead of Holidays–Mortgage expert weighs in

The Reserve Bank of New Zealand has lowered the official cash rate (OCR) by 25 basis points to 2.25 actual percent, marking the lowest level since June 2022. The move is aimed at supporting economic recovery. The cut was announced on 26 November, 2025.

Mortgage expert Nathan Miglani from Squirrel, who tracks housing and mortgage trends, said the cut was expected by industry experts and is welcome news for borrowers ahead of the holiday season.

“The OCR cut will create more momentum to the property market. This points to recovery in the market,” Miglani told The Indian Weekender.

However, he cautioned that business confidence in sectors like hospitality and retail remains subdued, as the full effects of an OCR cut typically take around nine months to materialise.

“Today’s OCR cut impact will be visible next year,” he explained.

Miglani added that as momentum builds in the coming months, due to the lower interest rates, borrowers should take advice before fixing their home loans.

Finance Minister Nicola Willis urged banks to pass on “as much as possible” of the OCR cut to home loan rates. Following the Reserve Bank’s announcement, banks began lowering floating mortgage rates on Wednesday.

Speaking in Auckland on Thursday, Willis said the Reserve Bank would monitor banks’ responses to the OCR cut but expressed hope that mortgage-holders would feel the benefit.

Miglani also noted that competition between banks is intensifying, describing it as a “mortgage war” that has been driving generous cashbacks for borrowers.

Looking ahead, Miglani said the property market is expected to strengthen in 2026, boosting borrower confidence.