It is the first time that the 2021 figure dropped below the same month in 2020
Total monthly new mortgage commitments in New Zealand hit $6.9 billion in September 2021, down $1.3 billion from the previous month – making it the first time all year that 2021 mortgage commitments plummeted below the same month in 2020, according to the Reserve Bank of New Zealand (RBNZ).
The latest RBNZ loan-to-value ratio (LVR) – new commitments summary tracked new mortgages granted to different borrower types, such as first-home buyers (FHBs) or investors, last month.
The latest figure may not be that surprising as the report covered three weeks of level 4 lockdown and one week of level 3 in the Auckland region, as well as one week of level 3 lockdown in other areas before moving to level 2 for the rest of the month.
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The RBNZ explained that new mortgage commitments to other owner-occupiers were the main reason for the dramatic drop in the total, down from $5.3 billion in August to $4.4 billion.
Meanwhile, new commitments to investors were $1.2 billion in September, down from $1.4 billion in the previous month and an annual decrease of -25.4%. FHB commitments were also only $1.2 billion, down $217.8 million from the previous month and -15.9% from last year.
Investors accounted for 17.9% of new mortgage commitments, up from a share of 16.9% in the previous month. FHBs accounted for 17.0%, while other owner-occupiers went down from 65.0% to 64.0%.
The central bank also revealed that the share of new mortgage commitments with high LVR to investors (>60%) increased from 32.2% in August to 33.4% in September. The share for FHBs (>80%) decreased from 40.5% to 39.2%, while other owner-occupiers (>80%) were down from 3.7% to 3.3% (all percentages before exemptions).
