Property investors “bounce back” in February: ANZ

Lending to property investors rose 33% in February from January, according to a new report from the bank.

Lending to investors rose by a third after plummeting 27% from December to January.  Year-on-year, investor lending has risen 1.4%, according to ANZ’s latest NZ Property Focus.

ANZ Senior economist Liz Kendall told TMM Online the February figures marked a return to more stable levels after an disproportionate dip in January. She said improved lending figures were still “much lower” than those seen in 2015/2016.

Investor lending made up just 22% of new lending, down from 34% in September 2015, according to ANZ’s data.  Kendall added: “Ultimately, we think the February outturn reflects monthly volatility, with new investor lending broadly stable overall.”

ANZ believes LVR restrictions will continue to impact property investors. The lender says ongoing restrictions mean any new lending will be on “less-risky terms”. According to the bank, investor lending at LVRs less than 70% made up an overwhelming 87% of loans in February. This compares to roughly half of loans made in late 2014.

Overall, ANZ says the New Zealand property market has stabilised after rising in the last six months of 2017. The bank believes a “fundamental supply-demand imbalance” will support prices, but LVR restrictions and affordability constraints will “contain” the market, particularly in Auckland.