OCR Holds at 2.25%, ASB's 5% Deposit Hack & Rents Drop (Week in Review)

Is the property market officially shifting gears?

In this episode of The Week in Review, Debbie Roberts unpacks a massive week of contradictory but exciting real estate news. We dive into a sudden surge in tourism and migration that has the broader economy starting to hum, and discuss why the Reserve Bank holding the OCR steady at 2.25% cements a "higher for longer" interest rate environment.

We also cover a massive win for first-home buyers as ASB joins the Kāinga Ora 5% deposit scheme with a unique lending advantage, plus a look at why the government just slashed Auckland's long-term housing targets by 400,000 homes.

Key Topics Covered:

• Migration & Tourism: How the late-2025 rebound is setting the stage for a housing revival.
• First Home Buyers: Why ASB's entry into the 5% deposit scheme—and their acceptance of two boarders' income—could boost your buying power.
• Interest Rates: What the OCR pause at 2.25% means for your fixed-rate mortgage strategy.
• Auckland Zoning: The government's U-turn on Plan Change 120 and what it means for character neighbourhoods.
• Market Data: Cotality's February update showing flat property values and a welcome drop in rents.

📢 FREE EVENT: Navigating a recovering market requires careful planning based on data, not headlines. Join our free online masterclass to learn how to structure your portfolio for success. 👉 Register here: https://www.propertyapprentice.co.nz

Timestamps: 0:00 - Intro: Economic Rebound & Mixed Signals 0:46 - Migration & Tourism Rebound 1:44 - ASB Joins Kāinga Ora 5% Deposit Scheme 2:50 - OCR Paused at 2.25% 5:10 - Auckland Housing Target Slashed 6:25 - Cotality Feb 2026 Data 8:30 - Final Thoughts & Free Event

Transcript

 Hi everyone. I'm Debbie Roberts, owner and financial Adviser at Property Apprentice. Welcome back to the Weekend Review. In this episode, I'll unpack the sudden surge in tourism and migration that has broader economy starting to hum while the Reserve Bank is holding the official cash rate steady at 2.25%, and a massive shakeup to Auckland's long-term housing targets.

Plus we have some fantastic news for first home buyers with ASB officially opening its doors to the 5% deposit scheme. Plenty to cover. So let's get stuck into it. Topics for this week from  📍 New Zealand Adviser on the 13th of February, migration and tourism rebound set stage for housing revival. Topic number two, from  📍 Good Returns on the 19th of Feb.

ASB joins, low deposit Kainga Ora scheme with some benefits. Topic number three from  📍 Oneroof on the 18th of February from Tony Alexander. What the OCR Pause and the Bank's Shock Emission means for mortgages? Topic number four from  📍 RNZ on the 19th of February, government listened to Aucklanders   by weakening Housing Intensification Rules Character Coalition says.

Topic number five,  📍 from Cotality on the 18th of February, monthly housing chart pack for February, 2026. 

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So first up for this Week in Review, we've got the New Zealand Adviser article from the 13th of February, migration and tourism rebound set stage for housing revival. According to recent Stats New Zealand data, the New Zealand economy is starting to hum fueled by a late 2025 turnaround in migration and a robust recovery in tourism. While overall net migration for the year was historically low,

december recorded the strongest monthly net inflow since early 2024. With kiwi departures, cooling, and non-resident arrivals rising, this strengthening immigration is expected to ease the drag on domestic demand and the housing market. Tourism has also bounced back with overseas visitor arrivals, surpassing 3.5 million for the year.

That's reaching 90% of pre pandemic levels. What does this mean for borrowers? A firmer economy points to firmer interest rates. ASB economists expect a gradual series of official cash rate hikes starting late this year, potentially peaking at 3.25% in the second half of 2027. Mortgage advisers are urging clients to stress test for higher repayments as improving economic growth takes center stage over rate cuts.

My thoughts on this are you fix for as long as you can, but but still make, make sure that it's a. Uh, financially viable for you and also obviously you wouldn't wanna fix for a long term if you were planning on selling in the short to medium term. Also important to point out that even though we've had an increase in net migration, we are still at levels about half of the long-term average.

So we're a long way off from having booming migration back into New Zealand, but it is certainly going to help fill some jobs and, uh, and put some, you know, bit more demand on the rental market and the property market in general. 

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And topic number two, from Good Returns on the 19th of February, ASB joins the low deposit Kainga Ora scheme with some benefits.

Great news for first home buyers. ASB has officially joined the Kainga Ora first home loan scheme. This initiative allows buyers, eligible buyers who can afford regular repayments but struggle to save a 20% deposit to purchase a home with just 5% deposit. Eligible buyers who've contributed to KiwiSaver for at least three years can withdraw their savings for the deposit and will also qualify for ASB's first home buyer cashback offer of at least $5,000 for mortgages

over $200,000. Borrowers using the scheme do need to pay a one-off lender's mortgage insurance fee of 1.2% of the total loan. However, ASB brings a unique advantage to the table. Unlike other banks, they'll factor in the rental income from two borders. Not all banks will accept border income or at least won't accept two border incomes.

Mortgage advisers note that this could increase a low deposit borrower's purchasing power by up to a hundred thousand dollars. My advice is talk to your mortgage Adviser who's got access to a range of different lenders because you know there are other lenders that are available to be used with this low deposit, Kainga Ora scheme.

Certain criteria applies. So, you know, you need to have a below a certain income level to qualify for that topic.

 

 Number three, from Oneroof on the 18th of February from Tony Alexander. What the OCR Pause and the Bank's Shock Emission means for mortgages? The Reserve Bank of New Zealand, RBNZ, and its new governor, have unanimously voted to keep the official cash rate the OCR steady at 2.25%.

No surprises to anyone, I'm sure right where it sat since November last year. Despite global economic uncertainty, the committee's confident that inflation will comfortably return to the one to 3% target band. They're currently balancing the reality of high unemployment and sluggish consumer spending against the risk of businesses aggressively raising prices to rebuild their margins.

Even though the RBNZ underestimated inflation by 0.4%, they didn't give into market predictions of a rate hike later this year. Instead, they're sticking to their timeline of a first increase in mid 2027 with their projections. Economics commentator Tony Alexander notes that the RBNZ appears to be looking for excuses not to tighten.

He suggests the committee is stuck in a historical mindset of acting too late and too much when it comes to both tightening and easing. Recent statistics back up a cautious approach. National House prices dropped 0.6% in January, following a 0.7% fall in December while core retail spending on credit cards shrank by 1%, Alexander expects it'll be a few months before any surprisingly strong economic data emerges.

The RBNZ stance has caused wholesale borrowing costs to dip slightly, taking the immediate pressure off banks to further increase fixed mortgage rates in the short term with the urgency to hedge against rising rates cooling, alexander expects most borrowers will continue to fix for one or two years.

However, he notes that he would personally opt for a three year fixed term right now as a safeguard against businesses unexpectedly driving up prices. So my thoughts on this are, it is important to understand that the official cash rate really only affects the floating interest rates in very short-term.

It's the wholesale borrowing costs that affect the longer term interest rates. And the wholesale borrowing costs are determined by what the lenders think the Reserve Bank might do in 1, 2, 3, 4, 5 years from now. So long-term, interest rates could continue to increase, but you know, this announcement has certainly reduced the risk of the shorter-term interest rates go increasing at a faster rate.

So it's gonna be interesting to continue to watch this space, in my opinion. I think it has certainly removed the risk of seeing more increases in current interest rates in the short term. Also some good news is that moving forward, the Reserve Bank is gonna be able to look at monthly data for some of the things rather than quarterly.

So that's gonna help give them confidence to make decisions a little bit sooner rather than later. And that was announced in the budget from the government as well. So that's gonna really help.   📍  📍 Now if you'd like to learn more about the property market and how to succeed with property investing, join me for one of our free events that we hold regularly online.

As a financial Adviser and experienced investor, I'll show you how to navigate the current market with confidence and make the right decision for you and your family. We are live, online and independent. We don't sell property, so no conflict of interest there. Go to www.propertyapprentice.co.nz secure your free spot for one of those live online training sessions.

And feel free to ask questions in there.  I'll answer as many as I can.

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 Topic number four from RNZ on the 19th of February. Government listened to Aucklanders by weakening Housing Intensification Rules- character Coalition says cabinet has agreed to lower Auckland's long-term housing target from 2 million to at least 1.6 million homes.

This is a step back from the    highly debated Plan Change 120, which was designed to zone for 30 years of growth. Advocates from the Character Coalition and Davenport Historic Society welcomed the change calling the original target unrealistic. They criticized central government for imposing the rules, noting it threatened character neighborhoods and risked putting high rises in suburbs like  Howick, Belmont, and Milford. While the council will have more say over which areas avoid intensification heritage, advocates remain worried about character homes near the city's rail network, specifically around the  Maungawhau, Kingsland, and Morningside  stations. Auckland Mayor Wayne Brown fired a warning shot at Central government stating he will not be dictated to by cabinet.

While ACT leader David Seymour noted the government is waiting on a council summary before legislating the changes. Brown explicitly stated that the council's not seeking cabinet approval and would stick with the 2 million if forced. Brown dismissed the uproar, emphasizing that the 2 million figure was always just a long-term concept.

He added that if the reduced number calms down some worried elderly residents in Epsom, then that's done its job. And I tend to agree with him there. You know, the 2 million figure for new housing. That's, that's basically just to stop people from reaching thresholds. You know, it doesn't mean that 2 million are gonna get built, so it just gives developers confidence to make longer term plans without having to run into a situation where the council can't approve any further.

So, yeah, just because it had a 2 million figure didn't mean that 2 million properties were going to get built. 

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Topic number five from Cotality on the 18th of February, monthly housing chart pack for February, 2026.

The New Zealand property market kicked off 2026 cautiously. National median property values foul a modest 0.3% over the three months to January, leaving prices 17.5% below the 2022 peak. Auckland and Wellington continue to underperform while markets such as Dunedin, Invercargill, and parts of Canterbury are showing more resilience.

January sales dropped 10.7% year on year. However Cotality chief Property economist Kelvin Davidson, believes this is just a blip caused by deals being rushed into a strong December. When looking at December and January together, the upward sales trend remains intact. First time buyers saw their market share dip to 26.2% in January, but the overall volume of deals remained strong.

Mortgaged investors are holding steady thanks to lower interest rates, and there are early hints of movers. In other words, relocating owner occupiers, you know, people either upsizing or downsizing gaining the confidence to trade up or trade down. The rental market is softening as net migration falls and housing supply remains high.

National median rents dipped 0.8% year on year with Wellington experiencing a massive 10% drop. Auckland, Hamilton and Tauranga also saw declines while Christchurch and Dunedin held out better. With affordability reaching its best level in years, easing mortgage rates and listings drifting lower, the market is finding its footing.

Davidson expects a year of gradual modest growth and measured recovery rather than a sharp rebound. My thoughts on this are, I think that with rents coming down, that has gotta be good news for tenants. You know, rent is a lot more affordable than it's been for a long time, and having a bit of stability in the rental market is good for everyone.

It's good for landlords and it's good for tenants. And let's face it, there's a lot more tenants than landlords in the New Zealand property market. So I think this is good news for renters all around, and also with house prices coming down. It doesn't necessarily mean that the cash flow on properties has got worse because with house prices coming down and rent dipping, if you are looking at purchasing in the current market, these are the highest yields we've seen in a long time.

Yes, it could affect people who already own some rental properties, but you know, long-term tenants look after them and they will look after your property and stay longer term. Especially in my opinion, with the new pet bond rules, and things like that, it helps tenants have confidence that they're not gonna get turfed out of the house sooner rather than later.

So what's the verdict for the week? We are seeing a market that's finding its footing with cautious optimism from the Reserve Bank, holding steady on interest rates to rents resetting and first time buyer schemes expanding. There are clear opportunities for those paying attention. First clue should be when banks start relaxing their lending rules, it's because they've got confidence in the property market.

So, you know, that's a signal to everyone, in my opinion. And with the economy starting to show signs of recovery, as you know, starting to hum as they say, navigating this recovery does take careful planning.   📍  📍 If you're looking at buying your first home, using the new 5% deposit schemes, expanding your portfolio, or just trying to figure out how to structure your mortgage, you need a plan based on data, not on headlines.

Come along to one of our free events called How to Succeed with Property Investing. I'll give you some insights that could help you on your journey, whether you're an experienced investor or just getting started. This free session will give you some key tools and insights to make more confident informed decisions.

So register today and take that next step towards achieving your financial success. At the end of the free events, I'll also tell you more about how we could help you as a client to reach your long-term financial goals. If you'd like to find out more about how we can help you, go to www.propertyapprentice.co.nz today and register for one of our upcoming events.

 And   📍  📍 you'll also get the opportunity to have a phone call or meeting with my husband, Paul Roberts, through our website, www.propertyapprentice.co.nz.  But I do encourage you to come along to one of the free events as a first stop because that could answer a lot of your questions there. I look forward to seeing you, and for those of you that are already clients, you know you can call your coach whenever you like whenever you got questions.

Thanks for listening. 

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