Bank home loan approvals down 25% from a year ago in fresh de-leveraging sign

Home loan approvals fall 25% in early April

Home loan approvals fell to NZ$646.4 million in the last (short) week from NZ$779.5 million the previous week and approvals in the last 13 weeks are down 25% from the same period a year earlier, Reserve Bank figures show.

This suggests a combination of weak demand and tighter lending is driving a de-leveraging that will press down on house prices and economic activity generally in an economy still dependent on housing market to drive consumer spending. These home loan approvals surged in the Autumn of last year, presaging a rebound in the housing market, but have dipped in recent months as housing market activity dribbles away.