Further mortgage rate hikes may not be as severe as feared, according to local mortgage brokers.
Four retail banks have raised interest rates this week, and homeowners have been warned to brace for further rises as the Reserve Bank raises cash rates in the fight against inflation.
Term housing rates have increased by 44-54 basis points and currently range from just under 6% for 12-month loans to 7.29% for 5-year loans.
Rhys founder John Bolton thinks the peak of rate hikes may be near, but admits opinions are divided.
“My view is that house prices will peak at about 6%,” Bolton said.
“Today the one-year fixed rate is stuck at 5.99% – from my point of view, I think we’re there or there.
“It’s largely done, but there may be some rate hikes from here.
“We are all speculating until the Reserve Bank releases its next official cash rate announcement in mid-November.”
Bolton said banks will keep lending rates as low as possible to meet competitive pressures in the market.
This comes at the expense of savers who have not received a comparable increase in fixed deposit returns and savings accounts.
https://www.rnz.co.nz/news/national/477124/mortgage-hikes-peak-may-be-near-squirrel-founder-john-bolton-says The peak of mortgage rate hikes may be near, says Rhys founder John Bolton