Okay, so, the qualification first. One month is not a trend. Particularly not when it is a December.
But the latest Reserve Bank figures for residential mortgage lending by borrower type do feature a not insignificant drop-off in the share of mortgage monies taken by the seemingly (till now) bulletproof first home buyers, while the apparently moribund investor sector has just twitched a little.
At a headline level, the $5.121 billion advanced in total for December 2022 was the lowest in the 2022 year apart from the always slow month of January. And beyond that, if you exclude January months and the April and May 2020 lockdown-affected figures, it's the lowest monthly tally since February 2019. And it is the lowest December total since 2017.
The December 2022 total was a stonking $2.81 billion (35.4%) lower than the figure reported in December 2021 and some $4.531 billion (46.9%) lower than the mammoth $9.652 billion in December 2020 - which is the second biggest month on record, beaten only by the nearly $10.5 billion advanced in the heady days of March 2021.
In its separate 'Key Points' summary of the figures, the RBNZ says the total monthly new mortgage commitments in December 2022, were down $0.9 billion (15.4%) from November's figures.
On a seasonally-adjusted basis, looking to compare apples with apples, the latest month's figure represented a decrease of 3.3% from the figure for November 2022.
So, the December figures were pretty low, and as said above, we should never try to conclude anything from one month - particularly not one right at the end of the year.
However, back on those first home buyers (FHBs), a notable feature as the overall mortgage figures have kept on dropping over the past year is that the FHB grouping has stayed pretty strong in the market.
This grouping had its highest recorded (since start of the series in 2014) share of the overall lending in November, at 22.4%, but this dropped reasonably sharply in December to 21.7%. In terms of figures, the amount in December 2022 for the FHBs was $1.11 billion, down from $1.357 billion in November. It's the first notable drop in FHB share (barring a very, very slight drop in September) since June 2022. Is the unquenchable thirst for housing maybe getting close to quenched?
At the same time the investor grouping, which has seemingly been on the sidelines for some time now, did show an uptick in December 2022. The $913 million advanced to this grouping in December 2022 was down slightly on the $957 million in November, but the overall share of total advances blinked up noticeably from 15.8% in November to 17.8% in December 2022.
And that 17.8% share in December was the highest share for the investor grouping since the 18.4% recorded in February 2022.
Look, it is just one month, but it will be interesting to watch the next month or three and see whether any pattern forms here.
Separately, the RBNZ provided arguably some of the very good reasons why new mortgage monies are declining so much with the release of the quarterly mortgage loan reconciliation figures.
These showed that interest charged in the December 2022 quarter was some $3.549 billion, the highest figure since the RBNZ started this data series in 2014. The latest figure compares with the record low $2.323 billion interest charged in the September 2021 quarter (when the housing market was still raging).
In September 2021 the total stock of mortgages stood at $314,083 billion, while in December 2022 it was $337.395 billion. So, a 7.4% increase.
However, the rise in interest bill since September 2021, of $1.226 billion, represents an eye-watering 52.8% increase.
No surprise, perhaps, that the market has slowed, a little.
At this stage the overall loan reconciliation figures don't suggest borrower stress in meeting payments. But of course many people have not yet rolled over to the new higher mortgage rates now prevailing. And also, the overall figures will not highlight specific potential pressure points such as those who took, for example, million dollar mortgages (bearing in mind Auckland's median house price was over $1.25 million) at the height of the housing frenzy.
All of these figures are going to be well worth keeping an eye on in the coming months.