Will you always be a renter?
Poll: Fewer Kiwis are getting home loans, with economists saying they are being scared off by forecast interest rate hikes and high house prices.
Figures from the Reserve Bank show the number of loans and the amount of money lent by banks have been declining steadily since May.
It comes as the Government and the Reserve Bank try to curb rising house prices with new restrictions on low-deposit lending to be introduced from October 1.
Experts and agents predicted a surge in demand as people rushed to beat the requirements for 20 per cent deposits, but Reserve Bank mortgage approvals suggest this is not the case, though the figures do not include pre-approvals.
Reserve Bank home loan approval data shows that in the week ending May 24, 7067 loans were issued, a 7.6 per cent rise over the same week in 2012.
However, in the week ended August 23, 6705 loans were issued, a 4.9 per cent drop over the same period the year before.
The amount of money lent at May 24 was up 14 per cent on the same period last year but in the week ended August 23, it was down 0.4 per cent on that week last year.
The figures showed that while there were fewer loans, the amount being lent was more closely aligned with the previous year, suggesting the average mortgage was larger.
Dr Claire Matthews, from Massey University's Centre for Banking Studies, said that while record low interest rates had made buying more affordable, more people could be worried about forecast interest rate hikes. It could also be that people were being priced out of the market.
BNZ economist Doug Steel said the figures matched other indicators that the housing market had cooled over the past four months - including fewer house sales based on seasonally adjusted figures - but it was difficult to say why that was.
- © Fairfax NZ News