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Chris McKeen / Stuff
BNZ says it’s important that home prices stay affordable for ordinary buyers.
Bank of New Zealand has teamed up with ANZ, Westpac and ASB to increase the deposits residential property investors need for rental property loans.
Beginning December 7, investors will need a 30 percent deposit for an investment property loan.
Ordinary home buyers will still qualify for mortgages with 20 percent deposits.
BNZ’s customer, product and service executive Dan Huggins said that given the importance of ensuring that home ownership remained affordable to buyers and that prices remained sustainable, the bank had decided to return to its loan relationship. -value (LVR) prior to Covid. requirements.
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The move follows those of ANZ and ASB earlier this month, which cited high house prices and the importance of ordinary families being able to buy their own homes without being crowded out by investors.
Westpac was already requesting 30 percent deposits from real estate investors seeking loans to purchase residential investment properties.
The Reserve Bank was already consulting to introduce tighter LVR restrictions in March.
When ANZ made the decision on Nov. 13, the bank’s director of personal banking, Ben Kelleher, said it was designed so that more people could live in their own homes.
“It is in everyone’s interest that the prices of residential properties are sustainable [in the] long-term and for homeownership to be accessible to as many Kiwis as possible, ”said Kelleher.
On Nov. 13, ASB CEO Vittoria Shortt said a large surge in property demand from investors threatened to push home prices down a “potentially unsustainable path.”
Reserve Bank Governor Adrian Orr has come under fire for his attempts to stimulate the economy, which have lowered mortgage rates and fueled housing price inflation.
On Tuesday, Finance Minister Grant Robertson wrote Orr telling him it was time to think about runaway house prices.
“Housing price instability is detrimental to our goals of reducing inequality and poverty, and is also likely to negatively impact the government’s goal of creating a more productive and inclusive economy,” Robertson said in his letter. .
He wanted the central bank to think of ways that he and the government could work together to achieve “the sustained moderation in house prices that we have both sought.”
