Mortgage lending activity in July was $390 million (7%) up on July 2018, property analytics company CoreLogic New Zealand says.
This was driven by owner-occupiers rather than investors, and in particular first home buyers - as has been the case for several months now, CoreLogic says.
"Looking ahead to August’s results, given that fixed mortgage rates haven’t really changed as a result of the surprise 0.5% cut to the official cash rate, we wouldn’t anticipate a big spike in lending/borrowing activity. Then looming further out, of course, is the final decision around extra bank capital requirements."
The total of mortgage lending in July 2019 was $5.91 billion, up from $5.52 billion in July 2018. This reflected a pick up in growth in lending to owner-occupiers. It followed a solid result in June 2019, CoreLogic says.
"Within the owner-occupier category, it’s first home buyers that are still providing a lot of the impetus to mortgage lending activity, other owner-occupiers are recording steady growth as well.
"A further breakdown of the data continues to show that larger average loan sizes, rather than more loans, are the reason for the overall rise in the value of lending activity. In July, the average loan for an owner-occupier was $234,294, almost $20,000 higher than a year ago."
CoreLogic says interest-only lending remains a much smaller part of the market than in the past. In July, the share for this lending was 28.6% - the highest figure for four months, but still much lower than the figures in excess of 40% that were seen in 2015 and into the first half of 2016. This has primarily reflected reduced interest-only lending to investors rather than owner-occupiers, it notes.