Evidence is mounting that the Reserve Bank’s LVR restrictions are starting to have an impact. September’s mortgage data shows a big decline in lending nationwide with just a few exceptions, including Wellington. Wellington is bucking the trend, with the city experiencing some growth in the number of new mortgages.
Figures released by myvalocity show the number of new residential mortgage registrations has declined nationally by 21% on the same time last year. CEO Carmen Vicelich says mortgage registrations are a reliable tool to assess the state of the property market because the data is not just limited to the sales at the time but reflects the behaviour of all active buyers.
The beginning of Spring can often be relied on to mark a lift in mortgage registrations. This year, the data shows that the decline which began 12 months ago is continuing despite the traditionally buoyant season. Except in Wellington.
Wellington has seen a rise of 2.8% in the number of mortgages compared with the same time last year. This result comes on top of other figures released recently from QV that show Wellington house sales and prices have risen more than 21 percent over the past year. QV national spokesperson Andrea Rush said the Wellington property market was playing catch-up.
Mrs Vicelich says the nationwide decline in the number of mortgage registrations reflects fewer active investors in the market as well as a lack of supply. “Less homes for sale means less people moving and requiring new mortgages,” she said.
Meanwhile, the Wellington property market appears largely unaffected by the new LVR restrictions suggesting there’s still interest from property investors, particularly in more affordable areas such as the Hutt Valley, Porirua and the Kapiti Coast.