- 1 August, 2016
- PROPERTY MANAGEMENT, RESIDENTIAL
- Buying, LVR
• Restrictions for investor lending extended to nationwide from Auckland only
• Banks will be forced to require a 40 per cent deposit - up from 30 per cent - for at least 95 per cent of the loans they make in this area.
• Restrictions for owner-occupier lending extended from Auckland to nationwide.
• Required deposit level remains at 20 per cent for at least 90 per cent of bank lending.
- The exemption allowed under the current LVR policy will continue to operate, including for construction lending and major non-routine repairs of dwellings.
The Reserve Bank said to "simplify" the LVR policy, it has proposed removing the distinction between lending in Auckland and the rest of the country.
In June, the Reserve Bank left the official cash rate at 2.25 per cent, but Wheeler warned investors could soon be targeted by new LVR rules.
The Reserve Bank introduced LVRs of 20 per cent in 2013 to rein in the housing market, and last year it raised the limits to 30 per cent for investors in Auckland.
It will consult on the changes until August 10.