Market cooling might last - ANZ
The September market data from most sources, but notably REINZ, showed the housing market has slowed, while last week’s mortgage lending data recorded a big decline in lending.
Yesterday’s data from myvalocity, which showed a sharp drop in new mortgage registrations, provided further evidence of the trend.
While it was always expected that the new LVRs would reign in the runaway market to an extent, the question has always been whether their impact would be more than short-term.
The two previous rounds of LVR requirements introduced by the Reserve Bank have had a temporary effect on the market – before the ongoing high demand, shortage of supply equation has pushed the market back into high octane mode.
Many commentators expect the pattern to be repeated with this round of new LVR rules as the same supply and demand factors remain at play.
However, ANZ economists have said there are some important factors that mean this cooling of the market is likely to last for longer, although they don’t expect a market correction.
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