By Gareth Vaughan
More home loans were approved last week than in any week since June 2009 with the value of mortgages approved topping NZ$1.3 billion, the highest level since April 2009, Reserve Bank data shows.
The central bank's weekly mortgage approval data shows 7,245 mortgages were approved in the week ended March 30 valued at NZ$1.302 billion. The last time the volume was higher was 7,395 approvals in the week ended June 19, 2009, and the last time the value was greater was NZ$1.346 billion in the week ended April 3, 2009.
The weekly volume was up 18% year-on-year based on a comparison of the most recent 13 weeks of data to the same 13 weeks last year, with the value up 40%.
The figures for the week to March 30 continues a recent resurgence with the volume of approvals topping 7,000 (valued at NZ$1.165 billion) for the first time since September 2009 as recently as the week to March 16.
However to give some longer-term context, by volume the highest number of weekly approvals is 11,193 in the week ended December 15, 2006 and the highest value recorded - since the Reserve Bank started tracking the data in October 2003 - is NZ$1.542 billion in the week to March 16, 2007.
The latest weekly Reserve Bank data comes with Barfoot & Thompson, Auckland's biggest real estate firm, saying it sold more houses during March - 1,246 - than in any month for five years with the average price up 6.5% from February but down 1.7% from March 2011. It also comes against a backdrop of three of the big five banks - ASB, BNZ and Westpac - growing their home loans with loan-to-valuation ratios over 90%.
The Reserve Bank defines a mortgage approval as a firm commitment to provide credit for the purchase of housing, which has been accepted by the borrower. It says a commitment exists once the home loan application is approved, and a loan contract or letter of offer has been issued to the borrower. Seven banks respond to the Reserve Bank's survey, between them representing 99% of registered bank lending for housing, and about 94% of total housing lending.
Included in the data is the refinancing of other banks customers, any loan where the security changes, and any loan where the liability holder changes. Excluded is own customer refinance, business borrowing where the security is the owner’s home, and when the underlying value of a loan is “topped up," with only the topped up portion included. See more detail in the Reserve Bank's description of the data series here.
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