The number of mortgagee sales looks to be on the rise - but they are still just a fraction of the total market, experts say.

A mortgagee sale happens when a homeowner does not meet their mortgage repayments, so the property must be sold to repay the debt owed to the bank.

TradeMe currently has 65 residential properties listed as mortgagee sales, which is 35 per cent up on the same time last year.

But the site's property sales director Gavin Lloyd says that number was "quite small" - less than one per cent of TradeMe's more than 42,000 property listings.

"In the market overall we are seeing properties generally taking longer to sell so this could also be contributing to the number of mortgagee listings increasing.

"We know it's a tough time with the rising cost of living and interest rates taking its toll on homeowners, however mortgagee sales are often a last resort so some sellers may also look to proactively list their properties before they are required to by lenders."

In Wellington, Bayleys regional general manager Grant Henderson says his team would usually appraise up to three properties a year for banks considering mortgagee sales.

But lately, staff were hitting that number each month.

"We've got a broad range, from developers who've found themselves in a sticky situation due to funding, we've found mums and dads that've got themselves just in the wrong situation, but also investors.

"People have probably let it all go too long, and there's a lot of denial around the situation they're in."

Banks did not take such sales lightly, and it was an absolute last resort, he says.

"Based on some of the things we've seen, these people have been in financial difficulty for a long time, it's not just like, 'you lost your job last month, this month we're gonna close you down', this takes a long time for the banks ... to get to the point where they have to pull the pin."

People got plenty of warning and communication from the bank - up to three years' worth - before they exercise their mortgagee rights and force a sale, says Grant.

"Most pragmatic and practical mums and dads will get through it, but some people are just in that denial phase," he says.

Climbing interest rates, insurance costs and council rates had been tipping homeowners into difficulty in recent times.

For those reason, an increasing number of mortgagee sales was not surprising, CoreLogic chief property economist Kelvin Davidson says.

But it was "nothing like" the peak in 2009 after the global financial crisis, which was an extraordinary period.

That year, New Zealand saw up to 800 mortgagee sales in a month, compared to 24 in the first quarter of this year, Kevin says.

Lauren Crimp/RNZ