Refinancing your Mortgage this Year? Here’s What You Need to Know Before Making a Move.

As a mortgage adviser with over two decades of experience in the New Zealand market, I’ve witnessed firsthand how strategic mortgage refinancing can create significant financial opportunities for homeowners.?

With the Official Cash Rate (OCR) now at 3.75% and showing a downward trend, many people are wondering if now is the right time to refinance.

Understanding New Zealand Mortgage Rates in 2025

The current mortgage landscape presents some compelling opportunities. As of March 2025, we’re seeing competitive fixed-term rates starting from 4.99% for 2-year terms across major banks including ANZ, ASB, and BNZ.?

This represents a notable improvement from previous years and could mean substantial savings for many homeowners.

What makes the New Zealand mortgage market unique is our preference for shorter fixed-term mortgages, typically ranging from one to five years. This differs significantly from markets like the United States, where 30-year fixed terms are common.?

This structure creates more frequent opportunities for refinancing and rate optimisation.

Key Refinancing Benefits You Should Know

Let me share a recent client success story. Sarah and Mike, a Christchurch couple, were paying 7.5% on their $500,000 mortgage. After reviewing their situation, we secured a new rate of 4.99% on a 2-year fixed term. This adjustment reduced their monthly payments by $786, leading to potential savings of approximately $235,839 over their remaining 25-year term.

Beyond interest rate savings, refinancing can offer:

• Debt Consolidation: Merge high-interest debts into your mortgage at a lower rate
• Home Equity Access: Fund renovations or investments using your home’s increased value
• Loan Structure Flexibility: Adjust your loan term to either reduce monthly payments or pay off your mortgage faster

Why Partner with a Mortgage Adviser When it Comes to Refinancing?

The mortgage market’s complexity often surprises even experienced homeowners.?

Recent research by Financial Advice New Zealand reveals an impressive 87% of those who reviewed their mortgage with an adviser’s help believe the changes will save them money. Here’s why:

Market Access: We maintain relationships with multiple lenders and in some cases have access to rates and products not directly available to consumers. Currently, we work with 20+ lenders, each offering unique products suited for different situations.

Personalised Strategy: Every homeowner’s situation is unique. Recently, we worked with a client approaching retirement who wanted to refinance to a shorter term. We structured a solution that slightly increased their monthly payments but will save them around $75,000 in interest over the life of the loan.

Process Management: We handle the paperwork, negotiations, and communications with lenders. This typically saves our clients 15-20 hours of personal time during the refinancing process.

Making the Move: Next Steps

If you’re considering refinancing, here’s what you should know about the current market:

• Fixed rates are showing a downward trend, with 2-year terms particularly competitive
• 70% of New Zealand mortgages are due for refixing within the next 12 months
• According to the latest Valocity Market Insights Report, the housing market is stabilising, with the national median price at $780,000

The best time to review your mortgage is now, especially if:

• Your fixed term is ending within the next 6 months
• You haven’t reviewed your mortgage structure in the past 2 years
• Your financial situation has changed significantly

Would you like to understand how much you could save through refinancing??

Let’s connect. Feel free to schedule a no-obligation review of your current mortgage structure.

Cheers,

Cheers, Simon ?? 021 322 109