Stephanie Hall and Ryan Instone enjoy their house, which
they bought just before lending criteria were tightened.
Since the change, the number of first-home buyers has
dropped significantly. Photo by Dan Hutchinson.
The number of first-home buyers in Dunedin has dropped
since strict lending criteria came into force late last year.
Real estate agents, mortgage brokers and figures from
Quotable Value New Zealand all tell the same story - there
are fewer first-home buyers in the market in Dunedin.
From October 1 last year, the Reserve Bank directed banks to
restrict lending to buyers with less than a 20% deposit.
Real Estate Institute of New Zealand Otago spokeswoman Liz
Nidd said all of the buyers who had pre-approved loans before
the changes had now either bought properties or their finance
''Yes, there are less first-home buyers in the market and we
have seen that consistent downward trend ... I don't think we
are necessarily going to trend down any further.''
Quotable Value released data last week that showed a rise in
the percentage of first-home buyers in the overall market in
October and November before a sharp drop in December and
In Dunedin, the percentage of first-home buyers was estimated
to have dropped to 19.3% of the market from 21.4% before the
lending changes although the market over that period was
considered ''volatile'' by Quotable Value.
Ms Nidd said there were still options for people with less
than a 20% deposit, including Welcome Home Loans that only
Banks still had a small number of low-deposit loans they
could offer and people could draw money from KiwiSaver
accounts for a house deposit.
''Don't just throw your hands in the air and give up hope.''
Mortgage Link Otago director Glenda French had noticed the
drop in first-home buyers and others who had ''missed out''
on finance because they did not meet the rules.
She said those buyers who were in a good financial position
still had options with the main banks or non-bank lenders,
some of which were offering two-tier loans that amounted to