Real estate loans make up 87 per cent of New Zealanders' total debts, according to Statistics NZ.

Older Kiwis owe more for second properties than for their own homes, revealing a generational gap on housing debts.

Labour says the new figures, which reveal real estate loans make up 87 per cent of Kiwis' debts, show many are "mortgaging themselves to the hilt".

The average loan owed by those aged 25 to 44 years for a house they lived in was $145,000, dropping to $107,000 for those aged between 45 and 64, according to new figures from Statistics New Zealand for 2014/15.

CHARLOTTE CURD/FAIRFAX NZ Labour housing spokesman Phil Twyford says Kiwis are "drowning in debt".

Kiwis between 45 and 64 were more likely to owe money for other real estate than for their own homes. For the wider 25 to 64 year-old bracket, a third of people had a loan on a property they lived in.

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However, real estate loans were "well offset" against property values, with 29 cents of debt for every dollar of real estate assets.

Half of all Kiwis had a debt, owing an average of $79,000. However, most owned more than they owed.

Younger Kiwis had the highest debt levels, with those between 15 and 24 owing 47 cents for every dollar of assets, compared to 26 cents for those between 35 and 44, and just two cents for those older than 65.

'DROWNING IN DEBT'

Labour housing spokesman Phil Twyford said the data showed Kiwis were "drowning in debt, as even middle-income families mortgage themselves to the hilt to get a foothold in a runaway housing market".

"On the face of it, you'd have to say, that's a bloody - that's a massive portion of household debt devoted to home mortgages."

While those who had been in the property market for a long time would have improved their equity from the explosion in house prices, Twyford said the high debt levels could be "a very significant problem" for any recent home buyers.

"Million-dollar mortgages are not unusual in Auckland now, and you only need interest rates to go up a couple of points and a lot of people will be under water."

The figures showed a "massive divide" between generations, with younger Kiwis in "an impossible situation in this market".

Twyford said Reserve Bank figures showed that housing debt had grown from $161 billion to $223 billion since National won power - an increase of 39 per cent.

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