Sold, Auckland property. File photograph by Michael Craig
Sold, Auckland property. File photograph by Michael Craig
The rate at which New Zealand's housing debt is growing has slowed for the sixth consecutive month.
While total housing debt grew to a record $235.8 billion the trend for slower growth will be reassuring to the Reserve Bank which sees housing debts as a serious concern for the economy.
The slower growth rate of 7.7 per cent is down from a peak of 9.3 per cent in December.
The slower rate of growth reflects a housing market which has cooled, in Auckland at least, on the back of tighter bank lending criteria.
From last October the Reserve Bank's loan-to-value ratio (LVR) restrictions have required investors to hold deposits of at least 40 per cent.
The figures also support anecdotal claims that retail banks have become more cautious in their mortgage lending (although the banks say there has been no shift in official policy).
Other credit sectors such as agricultural and business lending have also stabilised.
The Reserve Bank identifies agricultural debt as a key risk to the economy.
Agricultural debt levels rose 2.6 per cent in the year to June, from a 2.2 per cent rise in the year to May, however, the growth rate has declined significantly in the past two years.
Agricultural debt rose 6 per cent in the year to June 2015 and by 7.3 per cent in the year to June 2016.
