That Home Loan Hub
Welcome to That Home Loan Hub, your ultimate guide to mastering the world of home loans and property. I'm Zebunisso Alimova, here to simplify the complexities of real estate and provide you with expert insights and the latest trends.
Whether you're a first-time homebuyer, an experienced investor, or simply curious about the property market, this podcast is for you. Join me each week as we unlock the secrets to property success and help you make informed decisions. Let's dive into the world of property together!
That Home Loan Hub
Santa Brought A Rate Rise And A Headache
A rate cut on paper and a rate rise at the bank counter—no wonder everyone feels blindsided. We open the hood on how mortgage pricing really works, why wholesale swap rates can overpower the OCR, and what last round’s Reserve Bank messaging might have signalled to lenders. The story isn’t just policy; it’s the cost of money in global markets, risk margins, and the speed at which banks move when funding curves jump.
We share what we’re hearing from clients across recruitment and services: budgets are stretched, hiring is cautious, and any “recovery” feels thin. That lived reality clashes with the latest rhetoric, especially when inflation measures include unavoidable bills like insurance and council rates. Property prices remain flat to soft in many areas, so a 30-basis-point lift on three-to-five-year fixes hits hard right before Christmas. Meanwhile, six-month rates dipped and some one-year offers held, creating odd pockets of value amid the shock.
If you’re choosing between certainty and flexibility, we lay out the trade-offs: shorter terms keep options open if cuts arrive; longer terms smooth cash flow but may cost more if the curve rolls over. First-home buyers still have a path with selective 3.99 percent specials on one- and two-year fixes, subject to criteria. We also offer our calls for early 2026: one of us sees scope for a February move lower if inflation and labour data soften; the other expects a hold while markets seek clearer signals. Either way, the practical game plan is the same—stress test, consider splitting terms, and avoid locking in from fear alone.
Ready to navigate the noise with a calm plan? Hit follow, share this with someone weighing a refix, and leave a quick review telling us your rate strategy for the next 12 months. Your take might help someone else choose wisely.
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Hello and what on earth is happening with the rates? Interest rates.
SPEAKER_01:Hello my gosh. Good morning. We are shocked.
SPEAKER_00:Everyone's shocked. What the hell? I was gonna say what the hell at the beginning, but then I thought, oof, maybe I'll get censored. But what on earth? We've been predicting the interest rates going down, down, down, down. And then all of a sudden, at a switch of a button, literally overnight, Westpac was the first one to go, hey, we're gonna just increase that. Yeah. And then all of a sudden, everyone else followed with the other two main banks this morning. So let's quickly talk about it and how it happened and why it happened. What do you think happened?
SPEAKER_01:Yeah, I mean, like it it definitely is a shock because everyone was predicting 2025 for all rates to drop. So we kind of all got our um crystal ball wrong. Like even the experts, you know, the economists and things like that have gotten it all wrong.
SPEAKER_00:Except Tony Alexander. He kept saying, he kept saying, hey guys, this is the lowest we got 4.99 for five years. Look at it.
SPEAKER_01:Yeah. Right? So yeah, we were a little bit shocked in that. However, obviously with interest rates, it's not just the official cash rate that determines what the interest rate where where it goes to, right? No. It's all also the swap what swap rates.
SPEAKER_00:So guys that listen to us this whole year, we've been talking about the swap rates and the wholesale rates as well.
SPEAKER_01:Yeah. So it's not just the one pillar that determines it, it's yeah, the wholesale rates. So wholesale rates, what the bank buys or borrows the money from their provider for. So if those go up, then they're gonna have to put their margins up as well.
SPEAKER_00:The only other thing I've been reading about is RBNZ miscommunication to the banks. Because apparently, in the last cut, in the last OCR card, they sort of indicated that this is it. You know, this is the last cut. Next year there won't be any cuts, and the economy's on the road to the recovery. And I believe this was the signal for miscommunication. I believe this is where things started to go wrong because they thought, oh crap, okay, so next year everything's gonna go up. Let's start putting it up now. And I believe this is what happened. I I still think next year is not gonna go up because Right? This is exactly what we're all thinking, and this is exactly the feel I'm getting out there, talking to various clients across various sectors. And like yesterday, I was having a really good chat with a client of ours that's in HR in recruitment. And he's like, There's no way the economy is recovering. Everyone was on their knees for the last few years, yeah, and it's you know, and if it is recovering, it's so small, the recovery is so tiny that it, you know, he goes, I cannot justify the rates going up so much.
SPEAKER_01:I don't know where they're getting their data from or anything, like it is quite annoying with the whole recovery, they include insurance payments and rates and things like that. The living cost is the living cost has gone up, but they're saying we're recovering, so it's quite hard because you and I have seen, you know, our clients and things like that, and it's not recovering.
SPEAKER_00:No, no, people are struggling out here and the property prices as well, like you know, we're still sort of at the lowest. We're still at the lowest, it's flat, it's still dropping. I don't think it's going up. No, no, and that's you know, it's everyone is just absolutely mind blown, and it's such a big hit right before Christmas is it is, it is.
SPEAKER_01:It's like you're ending 2025, and like the long-term rates are three, four, and five years, right? Have gone up 30 points. That's like a massive jump. So you got OCR going down 25 points, and then those rates going up 30 points. How does that even make sense? Does not. No, it doesn't even our girl mash doesn't make it make sense.
SPEAKER_00:No, and the only hope is it's a temporary craze, and just to get people a little bit, you know, scared, maybe lock away for a bit longer. Yeah, and then next year I'm really hoping that in February they will start dropping them again, going, oh crap, we're gonna.
SPEAKER_01:I really, really hope that that's what they're trying to do. Just trying to lure you into those longer terms or to fix those in for longer terms. Maybe they can see something different coming on the horizon. But yeah. But even the feds have dropped their rates.
SPEAKER_00:Like they have not dropped their rates for ages, and now the feds have dropped the rates.
SPEAKER_01:Yeah, it it's interesting times, and it's yeah, real shock into 2025 in that environment, in our interest rate environment, considering for the whole year we're predicting drops.
SPEAKER_00:Okay, well, watch the space, guys. Watch the space and talk to your advisor, and your advisor does not have the crystal ball. No, I'm sorry. We got it wrong too. We got it wrong too. But the good news is still for the first-time buyers, we still have 3.99 available for one year and two years for our first-time buyers that qualify. Yep. We still have some short-term rates that are really good. So the six months actually went down.
SPEAKER_01:Six months have gone down. So we 4.49. Yes, and actually, some of the banks haven't actually increased their one-year rate either. So they've kept those. So it's only in the long-term rates, people.
SPEAKER_00:Exactly. Exactly. So on this wonderful note, what we'll do is we will make a quick prediction. I'm saying it's gonna go down in February. I think the OCR will go down, or the Reserve Bank governor, the new governor, she's been quite you know, verbal about how the banks should really pull their heads back in and you know, reduce and pass on those savings. So my prediction is it's gonna go down in February. What do you think? That's a hard one. I think it will stay. You think it stays? Yeah. Okay. Let's see. Yeah, let's see. You guys heard it here. Let's I bet you a bottle of wine.
SPEAKER_01:Yeah. Bottle of bubbles February 2026.
SPEAKER_00:Done deal. Thank you guys for listening in and go back and review a couple of other episodes Conch and I did around the wholesale rates and swap rates and what they mean for you. Thank you. Thanks, bye.
