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Investor lending falls in September

Mortgage lending to property investors fell to $1.01 billion last month amid ongoing tightening on interest-only credit, the latest Reserve Bank data shows.

Thursday, October 25th 2018, 5:00PM

by Dan Dunkley

Investor lending figures were slightly down on the same month in 2017 ($1.04 billion) and $0.5 billion short of September 2016 figures, the new figures show.

Investors borrowed less in September than May-August, according to the data. It comes as interest-only lending slumped to 30% of activity, down from highs of 41% in 2015.

Curbs on interest-only lending, influenced by Australian banking policy, have made it difficult for property investors to renew and access new interest-only credit over the course of the last year.

Ongoing LVR restrictions continue to dampen the investor market.

CoreLogic senior analyst Kelvin Davidson says the subdued investor figures reflected the interest-only clampdown.

“This drop in interest-only lending helps to explain the slight dip in new credit going to investors in September.”

Overall, new lending totalled $4.7 last month, up from $4.56 billion in September last year. The figure marks the sixth consecutive increase on comparable figures from 2017.

First home buyer lending hit $821 million, up from $658 million in September 2017, the data shows.

Lenders remain cautious on lending against more than 80% LVR. This represented 9.1% of lending last month.

CoreLogic’s Davidson says that, overall, today’s figures are encouraging for a market struggling to break out of its recent flat activity levels.

"Yet our sales projection model suggests that volumes will remain stagnant at around 80,000 p.a. into 2019.

"So although the official cash rate is expected to stay at 1.75% until 2020, it may still take a relaxation of the LVR policy (which is outside our model) to provide renewed impetus to property sales as we look ahead to next year.”

Tags: CoreLogic Lending LVR RBNZ Reserve Bank

« Time to ease LVRs - ANZLVR restrictions eased for investors »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.05 3.95 4.49
ANZ Special - 3.55 3.45 3.99
ASB Bank 5.20 ▼3.89 ▲4.05 4.39
ASB Bank Special - ▼3.39 ▲3.55 3.89
BNZ - Classic - 3.55 3.45 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 4.95 4.95 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
HSBC Premier 5.24 3.35 3.35 3.35
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 4.04 3.95 4.39
Kiwibank 5.80 4.14 4.30 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.39 3.55 3.89
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.25 4.15 -
Pepper Money Near Prime 5.64 - 5.44 5.44
Lender Flt 1yr 2yr 3yr
Pepper Money Prime 5.18 - 4.98 4.98
Pepper Money Specialist 7.59 - 7.39 7.39
Resimac 4.50 4.86 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - 3.55 3.39 3.89
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.49 3.59 3.89
The Co-operative Bank - Standard 5.15 3.99 4.09 4.39
TSB Bank 6.09 4.35 4.25 4.69
Lender Flt 1yr 2yr 3yr
TSB Special 5.29 3.55 3.45 3.89
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.55 3.45 3.99
Median 5.34 4.02 4.09 4.39

Last updated: 22 November 2019 4:35pm

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