While there is no doubt the market is booming, these figures come as a surprise to NZPIF executive officer Sharon Cullwick. “This is an astonishing figure, but there could be a number of reasons for it. Many expats are returning from very well-paid jobs and investing their money in property. There is also the issue of bank swapping, people changing banks to get the best rates and terms for their investments.”

Kris Pedersen financial strategist at Kris Pedersen Mortgages (who specialise in property investing) says there was a lot of activity at the end of 2020.“It was definitely manic towards the end of the year and things have kicked off busy,” he says.

He believes that the LVR change will have some effect on investor activity, but that it may take a while. “It will take a few months to be able to tell how much [of an effect this has] as we still have clients who have 80% preapprovals in place, for example, who are scrambling to get those across the line before they expire.”

He says it will be a balancing act for the Reserve Bank, as they may be tempted to put a 40% restriction in: “But they need to be careful not to turn the lights out as that would have a disastrous flow-on effect for the most Covid-affected industries such as tourism, retail and hospitality.”

Pedersen says the pain felt in places like Queenstown, which is reliant on tourism, would worsen if the Reserve Bank introduced such a restriction. “It is a balancing act between a wealth division caused by rising house prices and people feeling richer, because of the rising asset prices, spending more than they otherwise would which is helping prop those industries up,” he says.

Campbell Hastie, mortgage adviser with Hastie Mortgages, says he has also been busy fielding enquiries from investors. “I had a few who settled a rental property last year plus more than the usual level of enquiry from people who were thinking about getting into their first one,” he says.

He puts it down to a number of factors. “Interest rates are the primary suspect. They fell, obviously. The RBNZ said they’d actively keep the OCR low. The RBNZ relaxed the LVR limits too (not for property investors per se but it did help). “All up you got better affordability plus confidence that that state would be in place long-term plus some ‘free’ wealth (equity). The interest rate change also generated a significant change to the relative return of investments that produce rent versus interest.”

“The influx of returning Kiwis last year increased demand for housing generally (you look at what the immigration stats say about long-term arrivals). Taken together you had a whole heap of money literally looking for a home.”