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Reliance Newsletter February 2026
Discounted Interest Rates* as on 1st March 2026:
Variable 5.29% 6 Month Fixed 4.45% 1 Year Fixed 4.49%
18 months 4.64%
2 Year Fixed 4.69%
3 Year Fixed 4.95%
4 Years Fixed 5.14% 5 Year Fixed 5.29%
For good sized lending and low Loan to Value Ratio (LVR), Reliance Financial Group may get* these rates or even better depending on loan size. *Conditions apply. **From 16th April
First two months of 2026 have gone but long-anticipated economic recovery hardly looks convincing.
Households remain hesitant to embrace any potential upturn, and businesses are still not much willing to commit to major decisions for new investments.
But good part is that everyone is convinced that worst is over. Economy has started improving, though at very sluggish pace. Inflation ius expected to come down to 2% by year end and interest rates stay relatively stable during the year as OCR is expected to be raised only at the end of the year.
New Zealand’s economy is expected to outperform Australia’s in the next two years. Forecasts by the Reserve Bank of Australia (RBA) have the lucky country’s annual growth rate dipping to 1.8% by December and then falling to 1.6% by June next year.
Our Reserve Bank forecasts New Zealand’s GDP to grow at 0.5% for the year to March 2026, but then 2.8% to March 2027, and 3.1% to March 2028.
Westpac economists were even more upbeat in their economic overview last week, tipping growth to hit 3.3% for 2026, followed by 2.7% in 2027.
But with low interest rates and an agricultural export boom, it was inevitable that we’d see a bit of growth.
Economic growth in New Zealand will come off a much lower base. We’re not about to suddenly become wealthier than Australia. It will depend on which nation does a better job of lifting productivity and boosting the potential growth rate of the economy.
But New Zealand has a rare opportunity in the next few years to get itself into better shape with smart policy moves that lift our growth capacity
Interest Rate Scenario & Strategy
The downward trend in mortgage rates is widely considered to have bottomed out as of early 2026. Forecasts for 2026 and 2027 now lean toward a "flat for longer" period followed by gradual increases as the economy recovers and the RBNZ moves to "normalise" the Official Cash Rate (OCR).
Mortgage Rate Forecast: 2026
Most economists expect rates to remain relatively stable for the majority of the year, with a potential upward drift in the final quarter.
One-Year Fixed Rates: Projected to stay between 4.49% and 5.09% for most of the year. Some earlier optimistic sub-4% predictions have been revised upward following higher-than-expected inflation data in early 2026.
OCR Outlook: Expected to hold at 2.25% for much of 2026. However, ANZ and ASB have flagged risks of a 25bp hike as early as December 2026 if inflation remains sticky. Westpac predicts aggressive 25bp increases at nearly every meeting from February to September 2027, potentially reaching 3.75% by late 2027 which is called neutral setting. One-Year Fixed Rates: Forecast to climb toward 5.0% to 5.5% by the end of 2027.
How long to fix for in current scenario? This all depends on your personal financial situation, and how much certainty you need and how much variation risk you can take.
Fixing for short term gives benefit of lower rates now but lower rate for now, but when your loan comes foir refix say after a year, you may get much higher rate. If you are fine with this and can afford paying at higher rate, then good enough to fix for short term like one year. But a more balances approach to get some benefit of short term lower rate and also get some certainty of longer term fixed rate, fix part for short term and part for medium up to 3 years at slightly higher rate. . This will be a prudent approach in most cases.
If you wish to discuss your personal situation and seek advice for how long to fix, contact us . Call us or email us and we will be happy to advise best option for you at no cost and no obligation.
How is Housing Market going
House prices are hardly moving up or down but turnover has picked up.
People who had put their lives on hold amidst the chaos of the last few years are starting to jump back in and get on with things, and—although it’s taken a period of adjustment—vendors are letting go of their over-inflated ideas of what their houses are worth, and are much more willing to meet the market.
House prices are expected to stay around current level for next six months , according to Cotality. Its report says property values fell 0.1 percent in January.
Chief property economist Kelvin Davidson said it was a continuation of the flat activity seen through last year.
Good part is that there is a good stock of listings out there for buyers to choose from and a cautious attitude persists, and more and more are now coming everyday.
The net result is that buyers aren't in a rush to bid up prices, although vendors aren't generally having to drop their expectations much either.
He said it would be interesting to see what housing market policies were presented by politicians heading into the election and what that might mean for buyers and sellers.
The OCR increases might not be coming through straight away, so that probably gives some reassurance to the housing market.
It is expected house prices would rise, though slowly, this year.
When economic recovery becomes stronger, most likely in second half of the year, the unemployment rate will come down, making house prices buoyant.
Meanwhile, investors have also returned to the market but will be keeping a close eye on the politics, particularly around a possible capital gains tax and any discussions about interest deductibility.
Understanding Personal insurance
There are a lot of options for personal insurance. Here is what you need to know about life, health, trauma and income protection options.
When it comes to personal insurance protection, there are a range of different types of cover to choose from.
For many people, an appropriate solution could be a few different policies that fit together to form a comprehensive safety net. Others might choose to focus on protection against a particular risk.
A quick overview of the main types of personal insurance available, and why you might choose them.
Life insurance
Life insurance is designed to provide a lump sum payment when someone dies. You might choose this type of cover to provide peace-of-mind that your partner would have money to help clear the mortgage, for example, if you were no longer around. Or you might want to ensure that you left money for your children.
Health insurance
There are a few different types of health insurance, depending on the sort of cover you want, ranging from policies that cover everyday healthcare needs through to those that are designed to help only with more serious health events.
Broadly, health insurance policies help with the cost of seeking healthcare. If you have cover for specialist and surgical treatment, for example, that will help you with the cost of obtaining care privately, which can often mean less of a wait than you might face in the public health system.
Trauma cover
Trauma policies pay out if you suffer one of a number of specified serious health events. The situations in which a claim would be paid are included in each policy’s terms but usually include things like serious heart attacks, terminal illnesses and many types of cancer.
People taking out trauma cover choose a lump sum that they feel might be appropriate and that is then paid if the conditions of the policy/claimable event are met.
A trauma policy payout be used any way you need it – whether that’s for treatment or to spend on your family during a tough time.
Income protection
Income protection policies step in when you are not able to work due to illness. Although New Zealand has ACC for accidents, there is no similar protection for people who are off work due to illness. If you have a partner with a job, it’s unlikely that you will be able to access the sickness benefit. Income protection can help keep money coming into your household and help you pay the bills while you're off work.
Rent and mortgage protection
Rent and mortgage protection is another form of income replacement insurance. The cover amount is tied to a percentage of your gross income or your rent and mortgage payments. A benefit of this type of cover is that it is often not offset against ACC payments. Your adviser can help you work out whether that is an important factor in your insurance mix.
Want to talk?
To discuss your insurance needs, or if you have any questions about the different types of policies available, get in touch with us. We are ready to help, whatever your individual circumstances.
Disclaimer: Please note that the content provided is intended as an overview and as general information only. For full information contact us.
Health and travel insurance for visitors to New Zealand coming to work, study, or live
We also arrange plans designed to provide comprehensive cover for New Zealand bound international students, workers, non-NZ residents, visitors on working holiday visas, and seasonal workers
Who is eligible?
We arrange specialised insurance cover for a wide range of international visitors, including:
Talk to us for your needs.
14 Mar 2026