New builds drop
Economists at Westpac say there were small declines in residential building and the more volatile non-residential component in the June quarter.
"The level of building work is now down 1.3 per cent on the same time a year ago," they say in their weekly economic report.
"As we have discussed in recent weeks, the building industry is struggling to deliver the significant amount of work that is in the pipeline, much of which is centred in Auckland.
Rising costs, limited capacity and a tightening in credit conditions appear to be putting a brake on growth."
The economists expect that homebuilding in Auckland will increase only gradually over the next few years.
Lending lower
ANZ bank economists say new mortgage lending fell in June and estimate that, in seasonally adjusted terms, it fell 3.8 per cent, when compared with May's figure, to $4.87 billion.
Overall, new lending is down 25 per cent year on year, mirroring the decline in the value of housing turnover.
They say new investor lending continues to be weak. In June, lending to investors was down 49 per cent compared with a year ago. Lending to first home buyers in June was down 3.4 per cent on the 12 months prior.
According to a BNZ report, mortgage borrowers in Auckland are spending 49 per cent of their after-tax income on mortgage repayments - the same percentage as seen in 2007 before starting its decline to a little over 35 per cent in 2009. It started climbing in 2012.
Nationally, the portion of net income spent servicing home loans is 34 per cent, take Auckland out of the national figure and it drops to just below 30 per cent.
BNZ says Auckland house prices are falling and momentum across the rest of New Zealand is easing up. It expects the market to remain subdued into 2018
