The 1-year fixed mortgage rate has consistently been one of New Zealand’s most popular mortgage terms. During the current easing cycle, it offers the opportunity to refix in 12 months at potentially lower rates — but it also means higher refixing frequency and rollover risk.
1-Year Fixed Rates in New Zealand (April 2026)
| Bank | Indicative 1-year fixed rate |
|---|---|
| ANZ | ~5.55% |
| ASB | ~5.55% |
| BNZ | ~5.55% |
| Westpac | ~5.59% |
| Kiwibank | ~5.55% |
These are indicative carded rates as at April 2026. Actual rates change frequently — check bank websites or a broker for current offers.
Negotiated rates or broker-accessed rates are typically 0.1–0.3% lower than these carded rates. Cashback deals may effectively reduce your rate further over the fixed term.
Why Borrowers Choose 1-Year Fixed
The 1-year term is attractive when:
Interest rates are falling. If the OCR is in an easing cycle (as in 2025–2026), fixing for only 1 year means you’ll refix sooner — when rates may be lower. Fixing for 3 or 5 years at today’s rates could lock you above market if rates fall significantly.
You expect to sell or refinance within 2 years. A 1-year term means your break fee risk is minimal after the first 6 months. If you’re planning to sell, you can choose not to refix after the 1 year expires.
Market uncertainty is high. Short terms allow you to react faster to changing economic conditions.
1-Year Fixed vs Other Terms
| Term | Indicative rate (April 2026) | Rate outlook assumption | Best for |
|---|---|---|---|
| Floating | ~7.09% | No lock-in | Maximum flexibility |
| 6 months | ~6.89% | Short-term bridge | Very short-term flexibility |
| 1 year | ~5.55% | Rates may fall further | Rate-fall optionality |
| 2 years | ~5.45% | Moderate easing | Balanced certainty/flexibility |
| 3 years | ~5.69% | Rates stabilise near here | Certainty seekers |
| 5 years | ~5.89% | Long-term certainty | Those wanting no surprises |
Note: As at April 2026, 2-year rates are marginally lower than 1-year — the market is pricing some further rate cuts over 12 months, but not dramatic easing. This is unusual (normally short terms are lower) and reflects the market expectation that the OCR will settle, meaning rates beyond 12 months will stabilise.
1-Year Fixed: Break Fees
If you need to break a 1-year fixed rate before the term expires:
- Break fee calculation: Based on the difference between your contracted rate and the bank’s current rate for the remaining term — multiplied by your loan balance and remaining days.
- Typical 1-year break fee: $0–$3,000 depending on when you break and how rates have moved. Break fees increase when rates rise (because the bank loses nothing — it can relend at higher rates) and can be very low or zero when rates fall (because the bank can relend at the same or higher rate).
- Post-term rollover: No break fee applies if you wait until the fixed term expires.
See Mortgage Break Fees NZ for the full break fee calculation guide.
Refixing at the End of a 1-Year Term
At the end of your 1-year fixed period, you have several options:
- Refix for another year — if you still want short-term flexibility or expect rates to fall
- Fix for 2, 3, or 5 years — if you’re confident in rate direction or want certainty
- Roll to floating — if you have a specific plan to sell, refinance, or make large repayments soon
- Refinance to another lender — the end of a fixed term is the lowest-cost time to switch
Most banks will contact you 2–4 weeks before your fixed term expires with refixing options. You can typically negotiate from their carded offer. See Refixing Your Mortgage NZ for the full process.
Who Should Fix for 1 Year?
Good fit for 1-year fixed:
- Borrowers who believe rates will fall further in the next 12 months
- Borrowers planning to sell within 2 years
- Borrowers with high confidence they won’t need to break early
- Those who actively manage their mortgage and like frequent review opportunities
Less suitable for 1-year fixed:
- Borrowers who value certainty and don’t want to think about their rate every year
- Borrowers planning a significant life change in 6–18 months (career break, having children) — consider whether you could manage at floating rates if refixing is inconvenient
- Borrowers who tend to miss rollover windows and end up on floating by accident
Practical Tips for 1-Year Fixed
- Calendar your rollover — set a reminder 4 weeks before expiry to actively shop your rate
- Check the 2-year rate — sometimes the 2-year rate is lower than 1-year (as in April 2026); if so, consider whether locking the better 2-year rate makes more sense
- Ask about cashback — banks compete for loan volume at refixing; cashback is common for refinancers
- Don’t auto-roll — most banks will automatically roll you to the same 1-year term at the carded rate. You’re entitled to negotiate, and the carded rate is rarely the best rate.
Further Reading
- 2-Year Fixed Mortgage Rate NZ — comparing the 2-year term
- 3-Year Fixed Mortgage Rate NZ — comparing the 3-year term
- Fixed vs Floating Rate NZ — key decision framework
- When to Fix Your Mortgage NZ — strategic timing
- Refixing Your Mortgage NZ — what to do at rollover
- Mortgage Break Fees NZ — cost of breaking early
- Mortgage Rates NZ — full rate comparison