Mortgage enquiries are climbing, but turning them into approvals is taking longer. Centrix data showed enquiries up 14.4% in the September quarter while approvals of new mortgages fell 16% compared with a year earlier, with selective buyers and pre-election caution both playing a part.
Jeremy Andrews, director and mortgage adviser at Key Mortgages in Whangarei, says enquiries dropped off in the weeks before the 7 November election as clients waited for the outcome, then jumped sharply after the vote. He expects demand to outweigh supply heading into summer.
Pre-approvals remain strong, with close to 30 Key Mortgages clients currently pre-approved, helped by banks having more funding for low-deposit pre-approvals. Buyers are being pickier than they would be in a seller’s market. Two recent builders’ reports flagged $10,000 to $20,000 of deferred maintenance, and both buyers chose to keep looking, while well-presented homes are drawing multiple offers and bidders at auction.
Consumer debt is not proving a major barrier. Jeremy says credit cards or personal loans are not a deal breaker in themselves, though large balances relative to income or deposit can cut borrowing power significantly. Borrowers with strong incomes can often consolidate into cheaper options. Appetite for casual or self-employed income varies between banks, so Key Mortgages tests scenarios with several lenders.
“For clients in stable jobs and high-demand industries, banks are hungry for business,” he says. Planning to buy this summer? Getting pre-approved early is a smart first move.
Full article here: Choosy buyers slow NZ loan approvals as enquiries rebound - NZ Adviser
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