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Knowing that the Reserve Bank is moving to reestablish LVRs makes major banks willing to adapt.
The first bank to announce that it will do so is ASB.
He says he is moving immediately to increase the minimum deposit required from investors in the wake of the Reserve Bank’s announcement yesterday that LVRs will return in March 2021.
ASB Executive Director Vittoria Shortt said: “ASB believes that a balanced and sustainable housing market is the best for all New Zealanders. While we appreciate the RBNZ taking the time to consult, it is about helping Kiwis build their financial futures during exceptionally challenging times, which is why we are choosing to take this step now. “
Shortt said the loan market has improved markedly since New Zealand entered its first lockdown. COVID-19 has not impacted the real estate market as anticipated and ASB is now experiencing rapid growth in loan volumes.
“The number of applications we are receiving is at an all-time high, 70% more than this time last year, and while the proportion of first-home loans has increased, we have seen a rapid increase in loans since COVID-19. investor loans. If this surge in investor demand continues, it could lead the country down a potentially unsustainable path, “he said.
“Our focus at ASB is to work with the Government to provide opportunities for first-time home buyers to move up the property ladder. That is why we immediately commit to requiring investors to have a 30% deposit instead of the current 20%. Pre-approvals that are already in effect are not affected. “
