Advisers well placed to support clients’ needs as lenders start sharpening rates
Non-bank lender First Mortgage Trust senses heightened competition in New Zealand’s home lending market is in store for 2026 now that the OCR has been reduced to 2.25%.
Sue Griffiths (pictured), who recently took on the role of FMT’s national strategic partnerships manager, believes the timing of the rate “is helpful for advisers and clients heading into Christmas”.
She said: “After a tough 2025, any easing is welcome. We are seeing early signs of stability returning and this decision supports that. While 2025 has had its challenges, we are optimistic that 2026 will bring a more supportive environment for borrowers.”
However, the impact of the RBNZ’s monetary easing will be gradual, not instant.
“Borrowers are still a little cautious, but as fixed rate loans roll off, clients will start to feel real savings. That should improve confidence and lead to more refinancing and restructuring conversations. We are already seeing stronger enquiry levels from advisers,” said Griffiths.
Moving with the market
As a bank lending on variable rates, FMT is able to adjust quickly as the market moves.
“We recently reduced our rate to give advisers and their clients a more competitive option at a time when many businesses and households are still under pressure,” said Griffiths.
“Our pricing is based on risk rating and LVR bands, this allows us to offer more accurate, fair, and responsive pricing tailored to each deal, which advisers tell us is a key point of difference.
“Our recent reduction reflects the broader market landscape and our commitment to staying flexible, competitive, and supportive of advisers and their clients.”
Griffiths expects competition to heat up as the easing cycle progresses, with mortgage advisers well placed to support their clients’ needs.
“Some lenders may sharpen rates, while others will lean on incentives such as fee reductions, flexible terms, or cash back offers,” she said. “As economic indicators improve, we expect confidence to lift through 2026, creating more opportunities for advisers to help clients move ahead with plans that were on hold.”
Big banks like BNZ, ASB, Kiwibank, and ANZ have already moved to trim their floating and flexible mortgage rates following this week’s rate cut, with BNZ chief economist Mike Jones saying the cut was already “more than 100 percent priced” into the market.
Now the market is anticipating where monetary policy is going next, with some analysts suggesting the cycle may already be over.
