You’re not alone!

The latest data from the Credit Bureau of NZ (Centrix) indicates many NZ businesses and individuals are seriously stressed.

The number of New Zealand consumers behind on their payments has risen slightly to 461,000, up 5,000 month-on-month, equating to 12.31% of the credit active population. A map in the report seems to place Hawke’s Bay in the mid-range on arrears, at around 12%; a ‘highest arrears areas’ chart includes Wairoa ranking #2 at 16.11%, not surprising considering the weather-related flooding and transport stresses that region has encountered lately.

Financial hardship cases are up 24% year-on-year. Says Centrix, “These cases, which are an indicator of financial strife, have been rising on the whole since November 2022. 

45% of hardships relate to mortgage payment difficulties, with 29% relating to credit card debt, and 17% to personal loan repayments. The highest rate of financial hardship is with those aged between 35 and 39 years old.”

On the business side, credit defaults are up 5% across all sectors, with the transport and construction industries particularly badly hit, sitting at +25% and +22% year-on-year respectively. Company liquidations across the country are up 19% year-on-year.

Centrix singles out the construction business as taking it on the chin – 546 construction companies were placed into liquidation during the past 12 months, with non-residential building construction firms the hardest hit.

It’s hard to see how this is playing out in Hawke’s Bay. We can see heaps of building going on, but is the bloom coming off this rose? The struggling hospo sector seems more visible.

Where are we headed?

Centrix reports that new mortgage lending is up 7.8% in the August quarter over that period last year. On the other hand, the report notes that, “Non-mortgage new lending (credit cards, vehicle/personal loans, BNPL and overdrafts) is down 14.2% year-on-year, which reflects the significantly lower volumes of new car sales compared to last year, especially EV sales.”

Note that this report is all about credit-financed spending behaviour and risk. If you have plenty of cash on hand, spend it locally … our region can use the boost!