Overall credit growth rose to 0.2% in March in seasonally adjusted terms after running at zero or 0.1% in each of the previous seven months. Mortgage lending in March was up 1.3% on March last year.
“It's a hint of things ticking marginally higher but credit growth is still relatively subdued,” BNZ economist Doug Steel says.
“Our view of what's been happening in the last few months is that the average flatness has masked a lot of churn in the mortgage market,” Steel says.
While there's evidence of more first home buyers entering the market, there's also a lot of debt repayment going on, he says.
Floating rate mortgages at registered banks accounted for 62.6% of total bank lending on mortgages in March, up from 62.2% in February and compared with 50.3% in March last year and 31.2% in March 2010.
“There's not a lot of evidence of too much fixing going on,” says Darren Gibbs at Deutsche Bank.
The central bank's data on mortgage approvals showed a marked dip in the first two weeks of April which was probably due to Easter and the school holidays, Gibbs says. He has charted the data back five or six years and “there's always the same sort of pattern around Easter – two down weeks relative to trend and then its back. This year's no different.”
Approvals in the week ended April 20 jumped to 6,799, from 5,210 in the week ended April 13 and 5,951 in the week ended April 6 while approvals in the week ended March 30 were 7,245.
In the 13 weeks ended April 20, mortgage approvals were up 18.7% on the same 13 weeks of the previous year.
The Reserve Bank's figures also show a slowing in the growth of retail term deposits. They were up 7.7% in March after being up 8.8% in February and up 9.2% in January.
Gibbs says that is consistent with slowing income growth and it could indicate consumers are slightly more willing to spend than they have been.
