Mortgage applications top pre-GFC/recession levels
New Zealanders are applying for mortgages in greater numbers than at any time in the last seven years.
Wednesday, March 7th 2012, 8:48AM 
3 Comments
Latest statistics from Veda Advantage show for the hot property buying period of December, January and February more applications for mortgages were made during these three months than at any time since 2005.
Applications for this three month period reached their lowest in 2009 in the wake of the Global Finance Crisis but the trend is now reversed and setting new records.
The Auckland housing market has become very active and this activity will move to other areas.
"These statistics tell us what is coming down the track - there is a lot more heat in the property market and interest is well above pre-GFC levels," Veda managing director John Roberts says.
As part of the mortgage application process lenders obtain a credit report and Veda data shows a 23.05% increase in applications for the three month period (December, January and February 2012) compared with the same period the previous year.
When the month of February is compared with February 2011 applications are up 29.11%. Generation Y is leading the increase in applicants - up 36.55% but this is off low numbers. Applications by Generation X are up 34.58% February on February while Baby Boomer applications increased by 22.04%.
Veda statistics show a cooling in interest for hire purchase and personal loans while applications for credit cards are up slightly.
Mortgage inquiries: Age bands for three months December, January and February
| Year | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 |
| BB | -8.31% | -10.56% | -10.77% | -14.15% | 61.93% | 0.00% | 16.56% |
| Gen X | -13.83% | -12.46% | -19.09% | -22.24% | 58.12% | 1.04% | 27.22% |
| Gen Y | 3.99% | 4.07% | -15.90% | -36.48% | 47.09% | -3.05% | 34.75% |
| Total | -9.94% | -10.51% | -14.87% | -19.29% | 60.45% | 0.07% | 23.05% |
Mortgage inquiries: Age bands for the month of February, year on year comparison
| Year | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 |
| BB | -4.57% | -16.08% | -10.51% | -6.13% | 49.74% | 1.02% | 22.04% |
| Gen X | -12.19% | -15.63% | -19.42% | -14.38% | 47.05% | 1.56% | 34.58% |
| Gen Y | 7.39% | -7.15% | -17.15% | -26.50% | 32.04% | 7.42% | 36.55% |
| Total | -7.46% | -15.36% | -14.92% | -10.73% | 48.27% | 1.26% | 29.11% |
ENDS
| « Sluggish mortgage growth prompts aggressive loosening of lending standards | Time to fix: Westpac » |
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Comments from our readers
If you have clients that want up to 3 different offer letters presented to them then I suggest that they'll also be the kind of client that goes themselves to BNZ or Kiwibank behind your back for another offer again. Whilst I am passionate that I always canvas all the banks/lenders I deal with for the best deal I don't have to place a physical loan application at 3 different lenders to know where the best deal will be! Brokers that fire off applications to multiple lenders just clog up the system for the rest of us quite frankly.
Drawdown ratios are hot topic amongst all the lenders at present (given stories like Terry's above). It's almost certain that lenders will in time start to pay mortgage brokers different commission rates based on the quality of their loan submission and loans actually settled vs. those submitted.
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