New Zealanders vote with their wallets when it comes to assessing the country’s economy and economic outlook
Despite a recent global survey suggesting an uncertain outlook for our economy, cold hard data from New Zealand’s leading credit bureau shows New Zealanders are increasingly confident about their economic situation.
Veda Managing Director John Roberts says “We can talk ourselves out of feeling good or we can read the numbers – and I say the New Zealand economy is picking up and New Zealanders know it.”
“We see 98 percent of all credit inquiries made in New Zealand on a daily basis and this along with market data reveals the exact opposite of recent doom and gloom qualitative surveys conducted offshore.”
Here house prices are climbing, there was a 25.8 percent increase in the NZX50 in 2012 while a strong Kiwi dollar indicates international investors believe the country is a good place to have their funds.
All this translates to an upswing in consumer confidence in New Zealand. Veda’s data shows credit enquiry volumes consistently growing.
Consumer credit activity increased by 8.07 percent for the month of December 2012 compared with December 2011. It is the second consecutive year showing an increase in inquires, indicating the beginnings of a revitalised credit cycle.
The bulk of this activity is in mortgage applications – reflecting not only demand for housing and a buoyant housing market but also strong competition in the mortgage space with major banks reducing fixed term interest rates.
Mortgage applications were up 19.71 percent in December 2012 compared with 12 months earlier. Generation Y and X led the applications over Baby Boomers.
Mr. Roberts says that this quiet rebound in the credit cycle is already showing signs of maturity with consumers appearing to choose personal loans and hire purchase over credit cards.
Veda’s data shows credit card applications down by 4.53 percent for December 2012 compared with December 2011 while the same comparison puts personal loan applications up 11.83 percent and hire purchase applications up 8.79 percent.
That borrowing could well have gone towards a new car. In December alone there was a 14.6 percent increase in new car registrations compared with December 2011.
“I am optimistic about 2013 and it is clear many other New Zealanders feel the same way,” Mr Roberts says.
ENDS
