Mortgage Application

PHOTO: March, 2023 figures show you we are in for a slowing of house sales. FILE

The New Zealand housing market has experienced a significant slowdown in the number of mortgage applications for residential real estate in recent times. There are various factors contributing to this trend, including rising interest rates, stricter lending criteria, and a cooling of the property market.

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One of the primary reasons for the drop in mortgage applications is the rise in interest rates. Over the past few years, New Zealand has experienced an increase in the cost of borrowing money, with interest rates going up from historically low levels. This rise in rates has made it more expensive for homebuyers to borrow money, reducing their purchasing power and dampening demand for housing.

Another factor contributing to the decline in mortgage applications is the tighter lending criteria imposed by banks and financial institutions. In response to concerns about high levels of household debt, the Reserve Bank of New Zealand has introduced new lending restrictions, including limits on high loan-to-value ratios and stricter requirements for proof of income and affordability. As a result, many prospective homebuyers are finding it more difficult to secure financing, which has further dampened demand for housing.

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In addition to these factors, the property market in New Zealand has cooled in recent years, with house prices stabilizing after a period of rapid growth. This cooling trend has reduced the urgency among buyers to enter the market, leading to a decline in the number of mortgage applications for residential real estate.

Previous years:Monthly:
Feb 2021Feb 2022Oct 2022Nov 2022Dec 2022Jan 2023Feb 2023
Total lending ($million)
All borrower types7,6015,7305,5826,0555,1212,7753,836
First home buyers1,1829541,2191,3571,110640815
Other owner-occupiers4,5273,6563,3793,6563,0201,6672,329
Business purposes52648084783965
Higher than 80% LVR lending ($million)
All borrower types591312501567470292363
First home buyers426211381440369233266
Other owner-occupiers16096110121955688
Business purposes1021010
Less than or equal to 80% LVR lending ($million)
All borrower types7,0105,4185,0815,4884,6502,4833,473
First home buyers756743838918741408549
Other owner-occupiers4,3673,5603,2693,5362,9261,6112,241
Business purposes52647983783965
MEMO ITEM: Lending to investors ($million)
Total lending1,8391,057904957913428626
Higher than 70% LVR lending39011417015716871119
Less than or equal to 70% LVR lending1,449944733800744357507
Higher than 60% LVR lending1,003332326339332148205
Less than or equal to 60% LVR lending836725578618580280421

General notes

  • Individual figures may not sum to the totals due to rounding
  • Percentage changes are calculated on unrounded numbers
  • You are free to copy, distribute and adapt these statistics subject to the conditions listed on our copyright page.



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