Yeah well as far as the Reserve Bank of New Zealand is concerned the LVR rules (Loan to value ratio) have been set aside for at least twelve months. In terms of their macro prudential tool kit.
However before you start planning building you property investment empire with a five percent deposit from your credit card limit, consider this. The retail banks or what we think of as the normal banks have their own LVR rules.
So the banks might take a little while to try and remember how to do things as its been nearly four years of having to use the central banks LVR rules. Maybe a couple of weeks before the cards are on the table, at a guess. Then we also have to consider their appetite when taking into account Covid – the C word. I said it, its lurking, it might be gone, it might be back.
What I think it might mean for people?
Investment buyers – expect to be able to do things with 20% deposit across multiple properties.
5 tips for 1st time investors here
First home buyers – Might get a little easier to borrow with a 10% deposit. Expect much more scrutiny with less than a 10% deposit. Expect interest rates to get a little closer to what people with a 20% deposit get.
Get 7 tips for 1st home buyers here
What about the property market?
Property investors dropped their share of lending considerably when the RBNZ rules kicked in. I expect this might change.
