Further evidence of booming market

The amount borrowed far outstripped the $6.1 billion loaned in March 2020, and the $5.7 billion borrowed in March 2019. 

About $2.3 billion of the total went to investors, close to the $2.4 billion high recorded in December. In contrast, investors borrowed just $1.3 billion in March last year.

The total loaned to first home buyers was the highest on record. First home buyers received $1.7 billion, the highest total on data going back to 2014. 

The figures underline the strong level of demand in the market, despite reintroduced LVR rules kicking in from March 1.

However, higher LVR took a hit in March, continuing a downward trend that began at the end of 2020.

The share of high LVR mortgage commitments to investors fell to 13.2%, the fifth consecutive month of decline, according to the RBNZ.

Real estate research firm CoreLogic noted that high LVR lending to owner-occupiers had declined in recent months, with banks imposing their own limits ahead of the changes.

Kelvin Davidson, senior property economist at the firm, said the figures demonstrated a "cautious attitude" towards high LVR lending. 

Davidson said the data indicate the "significant effect" of LVR rules on investor lending activity, "even before the impacts of the Government’s housing and tax policy changes start to filter through over the coming months".