Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Interesting trends emerge in the credit demand cycle

New Zealand’s leading credit bureau seeing some interesting trends emerge in the credit demand cycle

Auckland, 10 April 2014 - New Zealand’s leading credit bureau, Veda, has reported some interesting movements in the credit demand cycle for the first quarter of 2014.
• Personal loans are up 12.5% on the same quarter in 2013
• Hire Purchase applications have risen by 4.3% for the March quarter compared to 2013
• Credit Card applications were up 4.1% on March quarter for 2013
• Housing applications down 6.4% on March quarter for 2013

John Roberts, Veda’s Managing Director, believes there is not only a strong recovery in the credit demand cycle with some of the strongest increases seen since the global financial credit crisis, there are also some emerging trends that will impact on the credit quality of New Zealanders as the economy grows through this economic recovery cycle.

Housing: Mortgage enquiries have seen another sharp decline for the second consequtive quarter since the Reserve Bank introduced new Loan To Value ratios in 2013. The biggest demographic impact has been Gen Y’s who are traditionally first home buyers. The other demographic affected is the Gen X’s who are down 13.5% for the same period last year. Interestingly these two groups are showing growth in personal loans.

Personal Lending: Personal loan applications grew by 12.5% in the March quarter. Generationally the largest growth was the inverse of the housing trend, with Gen Y growing at 14.1%. Anecdotal evidence suggests that this generation now feels that they are locked out of the housing market and are destined to be renters for the foreseeable future. Based on this, they are in the market upgrading cars and buying other consumer durables to enhance a lifestyle that home ownership would normally offer.

Gen X on the other hand has grown by 12.6% in personal lending. Analysis of credit applications following a mortgage application would suggest that a percentage of this group are using unsecured loans to assist funding the required deposit for home ownership with the new loan to equity rules. This could have an impact on credit fragility. If there are any significant adjustments in interest rates, as predicted by most financial commentators, over the next couple of years then rate rises on more costly unsecured finance could place stress on family finances.

About Veda
Veda is a data analytics company and the leading provider of credit information and analysis in Australia and New Zealand. From its core credit bureau business established in 1967, Veda has expanded to deliver a suite of credit and other analytical products targeted to specific industry segments.

Veda is built on the largest, most comprehensive and current data source in Australia and New Zealand with information on over 20 million credit active people and 5.7 million commercial entities. The breadth and depth of our data, and the knowledge it delivers help customers take a proactive and informed approach in making decisions.

Veda’s customers use data intelligence provided by Veda to make decisions on credit risk, verify identity and employee background, reduce identity theft and fraud, and undertake digital marketing strategies. www.veda.co.nz

Note
The Veda Bureau Insights measure the volume of credit card and personal loan applications that go through the Veda Consumer Credit Bureau by financial services credit providers in New Zealand. Credit applications represent an intention by consumers to acquire credit and in turn spend; therefore the index is a lead indicator.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news