How New Zealand Mortgages Work
Most New Zealand home loans are "table" mortgages — you pay a fixed regular amount that blends principal and interest. In the early years, most of each repayment goes toward interest; as the loan matures, more goes toward principal. Repayments can usually be made weekly, fortnightly, or monthly, and interest rates are typically fixed for a set term (6 months to 5 years) or floating and able to move at any time.
📈 Current Lowest Advertised Rates (as at 9 July 2026)
| Term | Lowest Rate |
|---|---|
| 6 months fixed | 4.49% |
| 1 year fixed | 4.65% |
| 2 years fixed | 5.19% |
| 3 years fixed | 5.29% |
| 4 years fixed | 5.39% |
Source: bank advertised rates, requires minimum 20% equity. Rates change frequently — check with your bank or a mortgage adviser for current offers.
📝 RBNZ Loan-to-Value Ratio (LVR) Rules
The Reserve Bank of New Zealand sets deposit guidelines to keep the housing market stable. Owner-occupiers generally need at least a 20% deposit (80% LVR). Investors generally need at least 30% for an existing property (70% LVR), or just 20% for a new build. Banks are allowed to approve a limited share of loans below these levels — up to 25% of owner-occupier lending and 10% of investor lending can currently sit below the standard deposit threshold. Eligible first home buyers may also qualify for Kāinga Ora's First Home Loan, allowing deposits as low as 5% (95% LVR). New builds are generally exempt from standard LVR restrictions for both owner-occupiers and investors. Debt-to-income (DTI) limits also apply: most new lending is capped at 6× gross income for owner-occupiers and 7× for investors.
💡 Example Calculation
Scenario: $750,000 property, $150,000 deposit (20%), 5.19% interest rate, 30-year term, monthly repayments.
1. Loan Amount: $750,000 − $150,000 = $600,000
2. LVR: $600,000 ÷ $750,000 = 80% (meets the standard owner-occupier guideline)
3. Monthly Repayment: approximately $3,290.96
4. Total Repaid over 30 years: approximately $1,184,746
5. Total Interest Paid: approximately $584,746
Note: Actual repayments depend on the exact rate offered by your bank and may include fees not shown here.
⚠️ Important Notes
- This calculator provides estimates only and assumes a standard table (principal & interest) loan with a rate that stays constant for the full term.
- It does not include bank fees, valuation fees, legal costs, low-equity premiums, or insurance.
- Real mortgages typically involve fixed-rate periods followed by refixing at a new rate, which this calculator does not model.
- LVR guidelines are indicative — actual bank lending criteria vary and may be stricter.
- For official guidance, see RBNZ – LVR Restrictions.
- Always confirm current rates and terms directly with your bank or a licensed mortgage adviser.