Mortgage statistics need careful interpretation

Mortgage statistics need careful interpretation

Latest Reserve Bank lending data released this week has shown that, over the last year, the proportion of lending to investors has risen from 29 percent to 33 per cent. This has led some to believe that property investment is rampant and a major reason for house price increases.

"Rather than show that there are too many investors' buying property right now, the Reserve Bank figures show that the level of investor activity is about right" says Andrew King, Executive Officer of the NZ Property Investors' Federation (NZPIF). "Rental properties account for around 35% of all residential properties in New Zealand, so it is not unexpected that they should represent 33% of buyers at any given time"

Existing home buyers made up the bulk of residential property buyers at nearly 60% of the market.

There is currently a shortage of rental property in many main urban areas, especially Auckland, so we need more rental properties, not fewer.

“It's important to note that rental property buyers want to pay the least they can for a property. Rental yields are low, so if the asking price goes too high, an investor will probably withdraw, leaving the field open to other buyers”.

ENDS

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