Residential mortgage lending dips in April

However, while slightly more subdued, housing market is still very active

Residential mortgage lending dips in April

New residential mortgage lending across the country decreased for all borrower types in April, according to recent figures from the Reserve Bank of New Zealand (RBNZ).

RBNZ data revealed that total residential mortgage lending in April 2021 was $8.4 billion, down 19% from $10.4 billion in March 2021.

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Broken down, lending to first home buyers in April was $1.7 billion, down 11% month-on-month from March’s $1.5 billion. Meanwhile, lending to investors fell 28% from $2.3 billion in March to $1.6 billion in April.

However, while lending decreased month-over-month, the total figure is still significantly higher than April 2020, when it was $2.7 billion, and April 2019, when it was $5.4 billion.

Bruce Patten, mortgage adviser at Loan Market, told stuff.co.nz that, while quieter, the housing market is still very active. 

“Auction clearance rates are a good example of the change – they are now at about 65%, whereas six weeks or so ago they were at about 85%,” Patten told stuff.co.nz. “So, the market is more subdued, but it’s returning to a more normalised state. It may be that by next April we’ll see mortgage lending back around the $5 billion mark seen in April 2019.”

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