[kylemuir]

When those fixed rates end and they have to refix a ton of overleveraged people will force mortgagee sales.

In Auckland there's been talk of that for at least 5-6 years. For example, people I personally know only earn $80-90k/yr and yet own a $500k house (absolute entry level livable house in Auckland). They also got in under our old rules which meant they only needed 5% deposit instead of the 20% required now.

They're only being propped up by their record low interest rates. If those interest rates went up 2-3% they'd be in serious trouble.

EDIT: for more context the average fixed period for any home loan in NZ is roughly 2-3 yrs. The term is a 30 year term typically.

[encoderer]

In USA it’s common for loans to be fixed rate for life of loan.