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Homeowners are feeling the effects of increases in interest rates by the Reserve Bank of New Zealand, credit rating agency Standard & Poor's says.
The agency's Mortgage Performance Index showed an increasing number of loans in arrears by more than 30 days in July compared with June.
"This suggests that the four incremental cash rate rises by the Reserve Bank of New Zealand in 2007 [when rates went from 7.5 per cent in March to 8.25 per cent in July] are starting to have a measurable impact on the capacity of borrowers to repay," said S&P analyst Helda Chan.
