Kiwibank the latest to raise longer-term home loan rates
The Reserve Bank of New Zealand has moved to calm financial markets after a sharp rise in wholesale interest rates. Governor Anna Breman issued a statement addressing tightening conditions and climbing mortgage costs. The changes follow recent adjustments by major banks, including Kiwibank, which has raised some fixed home loan rates while cutting others.
Breman, who took office on 1 December 2025, responded as financial markets priced in earlier-than-expected rate hikes. While the Reserve Bank’s forecasts had suggested a rise in 2027, traders now anticipate increases in the second half of 2026.
Kiwibank has adjusted its home loan rates in response to the shifting wholesale market. Its special two-to-five-year fixed rates for borrowers with at least 20% equity climbed by 20 to 30 basis points. At the same time, the bank lowered its six-month fixed rate by 16 basis points to 4.59%.
Borrowers without 20% equity also face higher costs. Kiwibank’s standard home loan rates for this group increased by a similar margin. The changes reflect broader pressure on longer-term lending rates after the Reserve Bank’s latest Official Cash Rate decision.
The adjustments come as banks react to rising wholesale funding costs. Kiwibank’s mixed rate changes highlight the shifting landscape for homeowners, with some facing higher repayments. Breman’s statement aims to ease market volatility, though traders continue to bet on earlier rate rises than the central bank has signalled.
