Turnaround times worsen

Advisers say a lack of staff to process home loan applications, coupled with rising activity, have made the situation even worse than 2019. 

"I think it has accelerated," said Squirrel's John Bolton. "The Auckland market has sprung back to life, and we're seeing a lot more 95% LVR stuff. There's higher levels of complexity, extra compliance and more paperwork. The volumes have blown the banks out," he added.

Bolton said banks were understaffed at central processing centres, causing some applications to be delayed by 1-2 weeks. "I'd consider 2-3 days a normal response time, but it's getting to a week before they look at a deal." 

Craig Pope, of Pope & Co Mortgages in Wellington, described turnaround times as a "nightmare" in the current market.