New mortgage approvals and loans have been growing at a faster rate and are now comparable with the pre-GFC peak levels. The value of house sales is now also near the 2006–07 peak levels (figure 2). Figure 2: House sales and changes in mortgage credit (monthly)  Source: REINZ, RBNZ.
If house prices and debt were rising from depressed levels, then these trends would not be of real concern. However the current house price and debt trends are on top of already high base levels – both by historical and international standards. For example, figure 3 shows New Zealand having the fifth highest house price overvaluation, relative to incomes, in the OECD.