Number of mortgage holders behind in payments up 1,100 in one month

Mortgage arrears are increasing – up 7% year on year in December, the latest Centrix data show.

The number of people behind on their mortgage repayments increased to 22,100, up 1,100 on November. During the month arrears rose 1.5% compared to 1.41% in November.

Financial hardship cases also rose significantly, up 19% year on year. Of the hardships, nearly half of these – 46% – related to mortgage payment difficulties.

New lending on residential mortgages was up 13.4% year-on-year.

Centrix managing director Keith McLaughlin says with the RBNZ poised for another 0.50% OCR cut, it is clear households and businesses are ready for more financial stability against a backdrop of global uncertainty and a challenging local environment.

He says it remains difficult for businesses with liquidations last year rising to 2,504, from 1,837 in 2023.

Construction was hard hit with liquidations up 41% year-on-year. There were nearly 200 building firms liquidated in the final quarter of the year, Centrix figures show.

“Residential new home builders recorded the highest number of annual liquidations, with 235 liquidations over the 12-month period,” McLaughlin says.

“While many were waiting for relief, at this stage it’s unclear what 2025 has in store for Kiwi households and businesses,”

“This highlights the challenges the sector is facing due to higher costs and reduced demand across the economy.”

The transport industry has also experienced a dramatic increase in business liquidations, with 131 companies going out of business compared to 73 in 2023 - representing a substantial 79% year-on- year rise.

Business credit defaults also remained high year-on-year in December. Construction credit defaults rose 40% year-on-year, followed by transport at 36% and hospitality 17%.

Across the board, the number of people behind on their consumer payments rose to 470,000 in December, up 6,000 from the previous month.

Consumer arrears levels were 1.3% higher year-on-year.

Specifically, arrears for personal loans  rose to 9.2% in December — up from 8.1% in November. Despite this uptick, the year-on-year comparison showed a relatively stable pattern

“While many were waiting for relief, at this stage it’s unclear what 2025 has in store for Kiwi households and businesses,” McLaughlin says.