Surprise – youngsters giving up on home ownership
Under 28-year olds have stopped applying for mortgages but are hitting their credit cards for consumables
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Credit information company Veda says fewer young Kiwis are taking out home loans.
Confirming a well-reported trend, Veda says its credit demand statistics for June, July, and August show people under age 28 are no longer applying for mortgages at the rate seen in previous years.
At the same time they are increasing their borrowing through personal loans and credit cards.
Veda blames the Reserve Bank’s loan to value ratios, four successive rises in interest rates on mortgages and Auckland’s soaring house prices rises.
Across all age groups, inquiries were down by 30% in August compared with August 2013 and down 13.74% for the three months to August.
It is the largest drop in mortgage inquiries Veda has seen since LVR restrictions were first introduced in October 2013, the company says in a prepared statement.
Mortgage inquiries from under 28-year olds were down 32.27% June to August 2014 (compared with the same period 2013) and mortgage inquires from people aged 28 to 43 years mortgage were down 17.66%.
Veda speculates that younger people are now more likely to borrow money for consumer items, having given up all hope of ever buying a home.
Chris Hutching
Wed, 24 Sep 2014
Wed, 24 Sep 2014
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Surprise – youngsters giving up on home ownership
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