OCR Cut: The Reserve Bank Moves to Support Growth
The Reserve Bank of New Zealand has delivered welcome news for mortgage holders and aspiring buyers, cutting the Official Cash Rate (OCR) by 25 basis points to 3.00%.
Ray White chief economist Nerida Conisbee said the move reflects mounting pressure in the labour market and record migration outflows.
“Unemployment has risen to 5.2% in the June quarter — the highest since 2020 — while underemployment is also increasing,” Ms Conisbee said.
“In the year to June 2025, 71,800 New Zealand citizens left the country — the highest level in 13 years. With inflation steady at 2.7% and within the RBNZ’s target band, there was clear justification to act.”
Banks are expected to pass the cut through within 2–3 weeks, providing relief to mortgage holders and renewed confidence for buyers. With the national median house price stable at $781,000 and listings elevated at 36,870, this easing may help re-energise the housing market.
Ray White New Zealand chief executive Daniel Coulson noted this cut is part of a longer easing cycle:
“Lower borrowing costs have encouraged buyers and sellers to re-engage with greater confidence. For those sitting on the fence, today’s announcement is a reminder that opportunities in the current market may be best taken sooner rather than later.”
For homeowners, this cut is a timely opportunity to review your mortgage structure. For buyers, it may create a more affordable entry point. For sellers, improving confidence could help unlock demand.
To understand how this rate cut could shape your next move, speak with our team today. For lending advice tailored to your circumstances, our finance partners at float are available to guide you.
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