Banks launch 'mini credit crunch,' but will it be enough to make house prices fall? In short: no.

The Kākā by Bernard Hickey

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Banks launch 'mini credit crunch,' but will it be enough to make house prices fall? In short: no.

Mortgage brokers report 'mini credit crunch' as banks toughen criteria for first home buyers, self employed and over 50s to cope with tighter LVR rules and likely DTI tool, plus Dec 1 start of CCFA

Bernard Hickey

Nov 23, 2021

∙ Paid

TLDR & TLDL: Mortgage brokers are seeing what is being described as a ‘mini credit-crunch’ launched in recent weeks by banks scrambling to reduce riskier lending in line with Reserve Bank directives, and to comply with a new law operating from Dec 1 to stop ‘irresponsible’ lending. (More detail below the paywalled fold)

Brokers report a clampdown on new mortgage lending to first home buyers, the self-employed and those over 50. Photo: Lynn Grieveson/TheKaka

Elsewhere in the news this morning, Air NZ cancelled over a 1,000 Trans-Tasman flights because of a lack of certainty on border rules from the Govt and Jerome Powell was appointed as Fed Chair for another term, sparking a rally on stock markets by those believing the ‘Powell Put’ to guarantee permanent and ever-rising record-highs from stocks is staying put.

Coming up later today, Stats NZ is expected to release retail sales data for the Sept quarter showing a 10% fall because of the lockdowns and we should see the detail of the vaccination mandates being passed through Parliament under urgency this week. I welcome suggestions for questions and lines of inquiry from paid subscribers in the comments below.