“Should I fix for one year or two?” is easily the most common question we get right now.

With the OCR now cut back to 2.25% after big hikes and then a series of reductions since 2024, the Reserve Bank is signalling a pause rather than a return to ultra-low rates. At the same time, banks price in their own funding costs and market expectations.

Here’s how we frame the decision with clients:

• Floating (or very short fixed) gives flexibility. You benefit quickly if rates fall further, and you can pay down extra without break fees. The trade-off is uncertainty.
• Longer fixes give budgeting certainty. You pay for insurance in the form of a slightly higher rate today, in exchange for knowing your repayments for 2–3 years.
• Splitting keeps you out of “all-or-nothing” territory. A mix of terms means you’ll never be 100% wrong – or 100% right – about future rate moves.

As brokers, we don’t pretend to have a crystal ball. Instead, we look at your cashflow, your risk tolerance and your plans (renovations, kids, business changes) and then build a structure that’s comfortable even if the market surprises us.