New mortgage registrations with banks have nosedived by a third while a $750,000 loan fixed for one year now costs about $160 more a week than it did a year ago.
Half the loans in New Zealand are fixed and due to roll over in the next 12 months and
The Premium Debate: Subscribers have their say on plummeting mortgage lending
Bay of Plenty Times
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Mortgage lending has dropped by a third. Photo / Getty Images
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What a dog's breakfast this government and the RBNZ have made.
Pip W
I work in real estate. I haven't had an offer from a first home buyer or investors on a property since November last year - they are completely locked out of the market. The upper end is selling well - something's not working.
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Alexander M
This reduction in applications/lending is really good to see. It is much better for potential applicants to voluntarily stop applying for loans rather than have penalties applied when they default. Plus the great worry/agro that goes with overextending financially. With the stupid price of housing these days and rising costs of loans (although house prices are dropping slowly) it is not a good idea to be a first-home buyer today. In two years' time prices will have dropped some more and inflation/housing loans will have settled, leaving first-home buyers with a fair chance of achieving their aims without undue pressure and grief.
Peter M
Don't at all feel sorry for the banks and their borrowers who speculate. This is a time of adjustment in the property cycle. Does the word reset come to mind?
Marcus A
Banks aren't logical. We're considering moving to reduce our mortgage by 20 per cent. Yet the bank wants a full application to see if we can afford ... 20 per cent less than they already lent us.
Glen S
The Government made changes to the CCFA but they don't come into June. While the volume of sales is down, prices are easing. The amount of places up for rent is growing as some try to ride it out when they can't sell. Those that have taken the rent for 10-20 years and not looked after the property are the ones who will suffer the most and fair enough too. I can't see the market tanking while the cost to build remains high.
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John B
The OCR is still only 1.5 per cent; traditionally, the banks would have been charging a floating rate about 2 per cent above the ORC but not at the moment. Lots of smoke and mirrors blaming someone else so the big Aussie banks can make super-profits and haul that profit out to Australia as management fees. It's starting to look like a bit of a train smash, particularly for people who have bought recently and for renters who will be missing out again.
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