2026 Mortgage forecast: Calm after the storm?

After years of rising interest rates and economic curveballs, 2026 is shaping up to be a refreshing shift for Kiwi homeowners and buyers. With the Official Cash Rate (OCR) holding firm and the major banks largely aligned in their forecasts, we’re heading into a year where stability and not volatility, takes centre stage.

So, what does that mean for your home loan? Enva Financial’s Head of Mortgages, Digby Butcher, unpacks the key trends and shares what they could mean for your finances in 2026.

What the banks are forcasting

All five major banks forecast the OCR to hold at 2.25% through most of 2026. Here’s how their expectations compare:

What this means for interest rates in 2026

In short: rates are expected to remain low and steady. 

• You’re unlikely to see sharp increases in your mortgage repayments.
• Floating and short-term fixed rates may stay attractive for longer.
• Household cash flow pressure could ease compared to recent years.

For homeowners rolling off higher fixed rates or those on variable terms, this signals a chance to breathe – and plan ahead with more confidence.

The housing market

A stable OCR doesn’t mean a runaway housing market. In fact, most experts are picking modest house price growth in 2026.

• Prices are stabilising in line with incomes.
• Supply is steady, demand is consistent – but not overheated.
• This is a market finding its balance again – good news for both first-home buyers and long-term investors.

An election year brings a cautious note

With the next general election scheduled for late 2026, political uncertainty can lead to a ‘wait and see’ approach among buyers and sellers.

“Buyers and sellers tend to wait to see how policy settings, housing rules and economic direction might change. While this doesn’t usually derail the market, it can soften momentum, particularly later in the year.”

What it means for you

If you’ve got a mortgage:

• Floating and short-term fixed rates will likely remain competitive
• You may not need to worry about sudden repayment jumps in 2026
• This could be a great year to rebuild your savings or reduce debt faster

If you’re buying:

• Stable rates make it easier to plan
• Locking in a fixed term could offer peace of mind, especially for first-home buyers.
• Consider “laddering” your fixed terms (e.g. splitting across 1 and 2 years) for a blend of certainty and flexibility

If you’re investing:

• More predictability in rates helps with forward planning
• Property prices may not spike, but steady conditions support long-term strategy
• Watch for early signs of rate changes in late 2026 or early 2027

“2026 is shaping up to be a year of relative calm in the mortgage world – something we haven’t seen in a while. Whether you’re buying, refinancing, or just holding steady, it’s a great time to explore your options and get your settings right for the years ahead.”

Uncertain about fixing, floating, or refinancing?

Let’s talk it through – our mortgage advisers are here to help! Chat with an Enva adviser today and find the mortgage strategy that fits your life – not just the market.

Email us at mortgages@enva.co.nz or give us a call on 0508 287 672

Disclaimer: This blog is for general information only and does not constitute personal financial advice. Always speak to a qualified financial adviser before making decisions related to your mortgage.