New LVR Restrictions Raise Questions for Wellington Property Purchasers

Friday 19 November 2021, 10:48AM
By Media Giant

Home Legal is on a mission to support Wellington property buyers. As part of that, the Wellington-based firm is prepared to guide prospective purchasers through the new loan-to-value ratio (LVR) restrictions now put in place for New Zealand by The Reserve Bank (Te Pūtea Matua).

Intended to reduce the risk for borrowers and banks in the face of a possible housing bubble collapse, the new rules increase the LVR restrictions and will effectively mean that far fewer owner-occupiers and investors can purchase with small deposits. Specifically, no more than 10 per cent of owner-occupier new lending can have an LVR above 80 per cent (i.e, a deposit of less than 20 per cent). Investor loans are restricted to no more than 5 per cent of new lending with an LVR above 60 per cent (i.e, a deposit of less than 40 per cent).

This increases hurdles for some prospective buyers and may raise questions. Home Legal knows residential conveyancing inside and out and can talk to clients about their options in the face of the restrictions which have been in place since the 1st of November.

To get in touch with the Home Legal team for answers to any questions about LVR or other property-related topics, call (04) 891 2188 or email