Actual mortgagee sales (as opposed to just listings) rose to a record high 191 in December, almost triple the number of sales reported in December 2007, a new report by Terralink has found.

"While the actual number of mortgagee sales is relatively low, the percentage of sales which are mortgagee is increasing dramatically," said Terralink International Managing Director Mike Donald.

Mortgagee sales in 2007 represented 0.25% of all sales, but this proportion rose to 4.4% of all sales by December 2008.

Terralink data showed that a disproportionate number of mortgagee sales were being driven by second tier lenders such as smaller finance companies, Donald said.

"Second tier lenders' proportion of mortgagee sales is much higher than their overall market share. This could indicate that smaller lenders are more distressed or that their loan books are riskier than their big trading bank competitors," he said.

Terralink get its mortgagee sales data from legal registrations of actual mortgagee sales. The new report reinforces the trends seen in the weekly Mortgagee listings report we here at interest.co.nz have been publishing since March last year. It shows listings on both realestate.co.nz and trademe.co.nz had more than trebled in the last year. There were 616 mortgagee listings on both sites at the beginning of this week. 

Realestate.co.nz CEO Alistair Helm said the Terralink Mortgagee Sales Report reinforced the trend he had seen on his website. "We've been tracking listings for mortgagee property sales for two years and we've seen up to a seven-fold increase in people searching for mortgagee properties during 2008," he said.

Terralink Mortgagee Sales Reports will be available at the end of each month and can be downloaded on www.zoodle.co.nz.

The full report for March (including December data and regional breakdowns is available here.)