New RBA data shows annual housing credit growth rose to 6.2% in August, after regulators gave their best indication a credit squeeze is coming.
Most of the growth was attributed to owner occupiers, surging 0.5 percentage points to 8.4% compared to the 12-month ended figure last month, while investment lending increased 0.3 percentage points to 2.2%.
The Annual housing credit growth figure is the highest since February 2018, while the owner occupier figure is the highest since October 2016.
By contrast, wages rose just 1.7% over the year, offset by trimmed mean inflation of 1.6%.
The RBA's data comes after the Council of Financial Regulators (CFR) indicated yesterday it is reviewing current framework around lending conditions after strong property price growth through the year.
One of the policies tabled includes clamping down on lending to borrowers with debt to income ratios above six, which has surged this year.
New Zealand already has loan-to-value ratio restrictions - most owner occupiers need a 20% deposit, and most investors need a 40% deposit, or equity.
From Friday, Kiwi property investors will also be able to claim only 75% of their mortgage interest against their rental income, while certain 'bright line test' capital gains tax advantages will also be tweaked.
"Housing credit growth surges as lending squeeze looms" was originally published on Savings.com.au and was republished with permission.