Mortgagee sale figures have reached a new high, with Auckland hardest hit, latest figures show.
There were 150 forced sales around the country in January, a five-fold increase from January 2007's 28 sales.
Experts believe the crisis is starting to hit average families who can no longer meet mortgage payments due to job losses, stalling business growth and mounting debt.
From 2007 to 2008, the number of sales forced by the inability of a mortgage-holder to meet repayments increased 275 per cent, coming off the back of four years of relative stability. Such sales hit a 14-year high in December.
Figures released by land and property information service Terralink reveal that Auckland had 76 mortgagee sales in January, a 192 per cent increase from the 26 in the same month last year.
Waikato recorded 12 sales (up from five) and Wellington clocked up seven sales (up from five).
There were increases, too, in Northland (10 sales, up from four), Hawke's Bay (seven sales, up from one), Manawatu (four sales, up from one), Wairarapa (two sales) and Taranaki (one sale).
In the South Island, Canterbury had 11 sales (up from seven), Otago eight (up from five) and Nelson four (up from two). There were small drops in Bay of Plenty, Marlborough and Southland.
Terralink managing director Mike Donald said he was surprised the total mortgagee sales had reached 150.
"That's a huge increase, which would indicate to us that the mortgagee sale trend isn't dropping away."
Preliminary figures for February suggest the trend will continue.
The nature of mortgagee sales is also changing. In December, more than 70 per cent were pushed by second-tier lenders such as smaller finance companies, many of which collapsed last year.
But in January this dropped to 58 per cent, meaning an increasing number of forced sales were being initiated by banks.
Massey University banking expert David Tripe said the biggest risk factors leading to mortgagee sales were loss of income and the amount people owed compared to the value of their house - the less equity held in the house, the greater the risk.
Unemployment in New Zealand is predicted to rise to about 7 per cent by the end of the year, translating to 160,000 people out of work.