The Reserve Bank of New Zealand has confirmed it will ease its loan-to-value ratio (LVR) restrictions from 1 December, following consultation with banks and changes to banks’ Conditions of Registration needed to implement the adjustment. The Bank cited the introduction of debt-to-income (DTI) restrictions last year as enabling less restrictive LVR settings on average, with looser default settings expected to apply most of the time except when risks are particularly elevated. For owner-occupiers, the share of new lending allowed with an LVR above 80% will increase to 25% from 20%. For investors, the share of new lending allowed with an LVR above 70% will rise to 10% from 5%. Housing-related risks and the impact of the changes will be monitored, and the new Financial Policy Committee will review LVR settings at least annually and can adjust them if risks become elevated.
Reserve Bank of New Zealand 2025-11-14
Reserve Bank of New Zealand eases loan-to-value ratio restrictions lifting high-LVR caps to 25% for owner-occupiers and 10% for investors
The Reserve Bank of New Zealand will ease loan-to-value ratio (LVR) restrictions from 1 December, increasing the share of new lending allowed with higher LVRs for owner-occupiers and investors. The changes follow the introduction of debt-to-income restrictions and will be monitored by the Financial Policy Committee, which will review LVR settings annually.