Monthly new mortgage commitments in New Zealand edged down to $7.9 billion in July, the lowest monthly total since February, according to the latest figures from the Reserve Bank (RBNZ).
July’s headline figure is a fall of 7%, or $592 million, in overall new mortgage borrowing compared to $8.5 billion in June. On an annual basis, July’s total monthly value of new commitments fell by 13.1%, or almost $1.2 billion, from July 2025.
The number of people who took out new mortgage commitments in July was down 4.9%, or 1,100, to 21,268 compared to a month earlier. The RBNZ said on an annual basis, that number decreased by 7.2%, or 1,662, from 22,930 in July 2025.
The Reserve Bank categorises borrower types for this data series by first home buyers, investors, other owner-occupiers and business purposes. The first three make up the main borrower categories.
In July, the RBNZ said the share of new mortgage commitments to investors fell the most, decreasing to 18.9%, down from 19.5% in June 2026. That’s a 2.3% fall when compared to July 2025.
Other owner-occupiers, which the RBNZ defines as borrowers who own or are buying a home to live in but are not first-home buyers, dipped to 59.6% from 60.4% in June. In July 2025, the share for other owner-occupiers was 58.3%, the RBNZ said.
The share of new mortgage commitments to first-home buyers increased to 20.1% in July, up from 19.0% in June. Compared to July 2025, there was an annual increase of 0.7%.
The RBNZ said the average new loan value across all purpose types fell to $369,256 during July, down 2.2% from $377,569 in June.1 On an annual basis, average values across all purpose types have decreased by 6.3% from $394,041.
In its May Monetary Policy Statement (MPS), the Reserve Bank noted rising mortgage rates are expected to dampen house price growth.
“If mortgage rates increase over time, consistent with current market pricing for wholesale rates, then mortgage holders will likely be refixing onto higher rates on average by March 2027,” the RBNZ said.
“The average interest rate on outstanding mortgages declined to 4.9% in March but is expected to increase to 5.3% over the next 12 months.”
Bank switching down
On a loan value basis, new commitments for changes in loan provider were down by 1.4% to $640,818 in July, according to the RBNZ, while the average value for property purchases dipped by 1.1% over the same monthly period, from $604,111 to $597,259.
On an annual basis, the number of new commitments for a change in loan provider fell by 21.1% in July compared to a year earlier, while the number of new commitments for top-ups rose by 0.5% and property purchases fell by 12.8% in that same period.
The share of the value of new commitments for property purchases increased to 57.4% in July, compared to June, when it was 55.9%. The share of borrowers changing loan providers decreased to 24.6 per cent this month, down from 27.2% in June. The share for top-ups increased to 12.4%, up from 11.7% in June, according to the RBNZ.
The RBNZ said earlier this month it’s maintaining banks’ low equity home lending limits at current levels by retaining loan-to-value-ratio (LVR) restrictions at current settings.
Angus McGregor, the RBNZ’s Assistant Governor for Financial Stability, described housing risks as “currently contained” and said house prices have remained broadly flat nationally in recent years, while mortgage lending growth has been modest.
LVR restrictions limit the volume of low equity mortgage lending banks can do. The current LVR restrictions, in place since December last year, allow up to 25% of new lending to have an LVR above 80% for owner-occupiers and allow up to 10% of new lending to have an LVR above 70% for investors.
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