Fixed or Floating? How to Choose

Buying a home in New Zealand isn’t just a financial decision anymore. It’s emotional. It’s stressful. It’s late-night conversations, spreadsheets, and that quiet fear of “what if we get this wrong?”

And right in the middle of it sits the question:
Do you fix your mortgage… or let it float?

The Reality Right Now

In 2026, things feel a bit calmer than the chaos of the past few years—but not exactly comfortable.

• Fixed rates: 4.5% – 5.5%
• Floating rates: 6.5% – 7.5%

That’s groceries. That’s childcare. That’s your life.

Why People Fix (It’s Not Just Money)

Most Kiwis fix their mortgage—and honestly, it’s not hard to see why.

Fixing is about sleep.

It’s knowing that next month, and the month after, your payments won’t suddenly jump. It’s being able to plan a holiday, or just survive rising costs without another surprise.

You give up flexibility, sure. And yeah, if rates drop, you might miss out. But what you gain is something people don’t talk about enough:

Peace of mind.

Why Some Still Float

Floating is a different mindset entirely.

“I don’t want to be stuck.”

• Pay off the mortgage faster
• Sell without penalties
• Switch rates easily if things improve

But let’s be honest—floating right now is expensive.

The Quiet Compromise Most People Make

Most people don’t go all-in on one option. They split.

• 80% fixed (stability)
• 20% floating (flexibility)

It’s not perfect. It’s not optimised. But it feels safer—and right now, that matters.

The Truth No One Can Predict

Everyone wants to know where rates are going.

No one really knows.

Not banks. Not economists. Not your mate who “follows the market.”

The Real Question

• Would rising payments stress me out?
• Do I value certainty more than potential savings?
• Am I disciplined enough to use a floating loan properly?

Final Thought

There’s no “perfect” choice in 2026.

• Fixing might cost you opportunity
• Floating might cost you sleep

Most people land somewhere in the middle—not because it’s mathematically perfect, but because it feels right.