Mortgagee house sales drop Baywide

Mortgagee sales are down in Rotorua.

Substantially fewer property owners are losing their homes to mortgagee sales.

Statistics released by CoreLogic shows 77 mortgagee sales were carried out in the Bay of Plenty - which included Rotorua - in 2014. This is a drop from 116 the previous year.

There had been a steady decline in mortgagee sale numbers since 2011 when there were 178 forced sales.

A mortgagee sale occurs when a person cannot afford their mortgage repayments and the bank or institution who lent them money for their property, exercises their right to sell the mortgagor's house or property to back pay the loan.

Owner of Mortgage Centre Rotorua, Graeme Leigh, said the decrease in mortgagee sales was due in part to steady house prices and more job security in Rotorua.

"It is to do with house prices and mortgage sizes. There are not the big loan values, not the big lay-offs in Rotorua that maybe other centres have seen, and there are not the big house prices here," he said.

"The housing market has also been a factor in the decline of mortgagee sales. It is quite steady and active, but it is not like Auckland. The difficult period that was experienced during and after the global financial crisis has past and I think Rotorua has come through that quite well."

Mr Leigh said Rotorua itself had fared well because of the variety of sectors providing income.

"Rotorua itself is buoyant and part of that is because it derives its income from so many sources. For example, you have got tourism international, you have tourism internal, forestry and manufacturing.

"There has also been a lot of new companies come into Rotorua so the town in that respect is doing well," he said.

Nationally, there were 198 mortgagee sales in the last three months of 2014. That was down from 243 in the previous quarter meaning fewer Kiwi homeowners were being forced to sell their houses.

Economist Shamubeel Eaqub said the drop was due to an economic upturn after the protracted global financial crisis.

"The general story on mortgagee sales is very positive," he said.

"The figures showed a huge departure from the pits of the recession, when at one point in 2009 mortgagee sales accounted for one in 25 of all homes sold."