Mortgage Design

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From Dream to Reality: Your Step-by-Step Plan for Successfully Buying a House in NZ Amidst Changing Mortgage Rates!

The best time to plant a tree was 70 years ago. The next best time is now!

If you’re looking for multitude gains accumulating over a few years, then there can be no better opportunity than investing in the real estate market. Taking tenure of investment into account, real estate has historically been one of the most secure investment havens and it could be for you too.

But with the ever evolving market, and the changing market rates, even investing in real estate can prove to be a minefield. But with experience and expertise at your back thanks to the brokers at MortgageDesign, you can rest assured that the deal is never going to affect you too deeply.

Understanding Mortgage Rates in New Zealand

Navigating the complex world of mortgage rates in New Zealand can be a daunting task. With fluctuating rates influenced by various economic factors, it’s essential to understand historical trends to make informed decisions.[1]

Historical Mortgage Rates

The average historical mortgage rates in New Zealand have seen significant variations over the years. The Reserve Bank of New Zealand (RBNZ) average floating rate, since records began in June 1998 stands at 6.90%.

However, this has seen some fluctuation in the recent past with it dropping to its lowest at 4.50% in October 2020. It had peaked in June 1998 touching a high of 11.20%[2]

Recent Trends and Forecasts

With the cost of living crisis and inflation now also affecting the market sentiment, in May 2023, the RBNZ increased the official cash rate to 5.5%, marking the 12th consecutive rate hike.

However, looking ahead, forecasts suggest one-year fixed mortgage interest rates might reach 7% in 2023 and potentially decline to around 4.5% as a long-term average in the coming years.[3]

Step-by-Step Guide for Mortgage in Auckland

Securing a mortgage in Auckland involves several key steps. Here’s a comprehensive guide based on information from various sources:

1. Assess Your Finances and Determine Your Budget: Understand your financial situation, including income, savings, and existing debts. Most lenders recommend mortgage repayments to be about 30-40% of your gross income.[4] It’s also important to have a solid foundation that can sustain mortgage repayments for at least 12 months.

However, these are terms that are almost always subject to further negotiation and can be helped along by your mortgage broker should you so require.

2. Save for a Deposit and Research Government Assistance: Aim to save a substantial deposit, ideally 20% of the home’s value. There are also several government schemes that industry operators will be apprised of that you can potentially take advantage of. With the Auckland, NZ real estate market, experience like that of MortgageDesign may help you negotiate these rates better than any other.

Government assistance options for first home buyers, such as the Welcome Home Loan scheme and KiwiSaver First-Home Withdrawal could also be an option for you for some financial gains.[5]

3. Research and Select a Lender: Compare different lenders, focusing on interest rates, customer experiences, and their reputations. Getting recommendations and conducting online research can help in selecting the right lender. While for the average joe, this may seem to be a bridge too far, with MortgageDesign having operated in this market for more than 30 years, you can be rest assured that no stone will be left unturned.

4. Obtain Pre-approval and Understand the Lending Process: Securing a pre-approval for a home loan can go a long way towards ensuring a better mortgage deal. This step helps in understanding your financial limits and makes you a more attractive buyer. With the help of your own Auckland mortgage real estate brokers, this step can be crucial in securing the deal you desire.

5. House Hunting and Legal Consultation: Begin searching for your ideal property within your budget. Concurrently, find a solicitor for independent legal advice, especially for reviewing property reports and legal documents. Making sure that you’ve gotten the right house can be a tough step, but with MortgageDesign by your side, the change is easy to come and can be achieved just as easily.

6. Finalize the Loan and Manage Mortgage Payments: Finalize your loan with the lender, providing all necessary documents and completing the required formalities. After acquiring the property, work with your lender to set up a suitable repayment plan and ensure timely payments.


The journey of buying a house in Auckland amidst changing mortgage rates requires a thorough understanding of the market, careful planning, and strategic decision-making. Keep abreast of the latest trends, forecasts, and utilize professional advice to navigate this challenging but rewarding process.

Make sure that the  interest rates don’t jump out with Auckland’s trusted mortgage brokers in MortgageDesign!

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We take into account your long-term financial goals, turning our focus to ensure that your mortgage structure is well-suited to enable your property portfolio to perform.