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It’s just a little bit odd at the moment trying to make sense of mortgage rates. The mortgage rate signals that borrowers are receiving are somewhat confusing.

It’s around this time of the year that I take an educated guess at what will happen with house prices and mortgage rates. As I’ve said time and time again, the strongest correlation that exists is between house prices and interest rates.

If you’re familiar with us, you’ll know that at Squirrel we don’t like to pull punches so here goes. Heartland Bank came out with a staggering mortgage rate of 1.99% fixed for 1-year. Naturally everyone got excited, but what is it actually? Since then, no other banks have followed.

After a short hiatus and a 5%-10% fall in house prices, I’m going out on a limb given the current market pessimism and predicting we will stretch into what might be the last great housing boom. Here's why.

There is a certain moralistic view which many analysts have of the housing market. It goes along the lines that people who make money from rising house prices are not as worthy as those who make money from working 40 hours a week, and one day they will get their comeuppance through house prices going back to where they were in some imagined glory days.

You heard it here, but also let’s acknowledge up front that I’ve called it before and been wrong. This situation is different though. The OCR has reached the bottom, bank margins are tight, and term deposits can't go much lower.

Interest rates are still low and the housing market seems to be thawing out after a slow 2019. That said, the latest uncertainty comes in the form of Coronavirus and what impact it could have on the economy. Here's a roundup of our views.

Auckland has come back to life after two years of lacklustre house sales and easing house prices. At the same time, the rest of New Zealand is taking a bit of a pause after a strong run of price appreciation.

There’s something mildly exciting about the Reserve Bank doing something unexpected. It’s like finding $5 in your jeans. I’m a borrower so I’m loving the prospect of lower rates but I’m also a realist and know that the reasons behind the OCR dropping are worrying. We should all be using this opportunity to pay back debt and build safety buffers into our lending.

Our view is that mortgage rates will stay low for the foreseeable future, but they are unlikely to drop much further. To explain this, we'll look at the bigger picture, and shed some light on how the OCR affects mortgage rates.

The Reserve Bank has come out with a gloomier outlook for the NZ economy and the global economy. In the short term that means the potential for lower mortgage rates has increased.

Most media commentators are hooked on the new ‘rate war’, and the question being asked is if this is the new ‘norm.’ It isn’t, and more than that, you could easily miss out if you procrastinate.