One of the clearest signals of how busy the mortgage market is has nothing to do with headlines or house price data - it’s how long banks take to process applications. When demand is high, turnaround times blow out. When things are quiet, they tighten right up.

Right now, according to Jeremy Andrews, director of Key Mortgages in Whangarei, things are very quiet. “During times when buyers have FOMO and business is pumping, a one week turnaround from a bank is excellent. Now none of the banks are taking that long. They typically have a one to three day turnaround.” Over the past two years, standard applications were routinely waiting eight to fifteen-plus working days. That gap tells the story.

Jeremy points to a combination of factors driving the slowdown: the lingering effects of Covid-era money supply, the unwinding of cheap OCR-driven lending, an oversupply of housing stock, and flat or falling property values dampening buyer confidence. Election uncertainty has added to the hesitancy, with a number of clients sitting on the fence waiting to see what coalition negotiations produce on tax and property policy.

There are some tailwinds worth watching. More low-deposit options are available than in recent years, and a record number of Australians are looking to buy in New Zealand as property tax settings across the Tasman shift. For borrowers who are ready, the current environment - fast approvals, competitive banks, and less pressure to rush decisions - is actually a relatively good time to be in the market.

At Key Mortgages, the focus remains on finding the right lending structure for each client’s situation, whether the market is pumping or paused.

Full article here: Mortgage sector slowdown highlighted by fast bank turnaround times - TMM Online