RBNZ to ease LVR restrictions

“Over the past year, we have reviewed our approach to setting LVR restrictions,” acting assistant governor financial stability, Angus McGregor says.

“We concluded that the introduction of debt-to-income (DTI) restrictions last year means LVR settings can be less restrictive on average. This includes looser default settings that we expect will be in place most of the time, except for when risks are particularly elevated,” McGregor said. 

DTI restrictions help to underpin borrower resilience by acting as a guardrail for risky lending. They can help contain the severity and consequences of housing market corrections.

“Easier LVR settings will give banks more flexibility to lend, improving market efficiency and access to credit, particularly for first home buyers.