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Mortgages

Mortgage Rates Daily Commentary
Thursday 19 May 2022  Add your comment
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40pc may not be the end of the rules

Investors could yet be in for more of a clampdown from the Reserve Bank, experts predict.

Thursday, October 6th 2016, 8:21PM

Loan-to-value restrictions were officially introduced this week, limiting banks' ability to lend to property investors with less than 40% equity in the deal.

While the rules became official on October 1, banks had been required to act in the spirit of the restriction since it was first announced.

That has led to a slowdown of activity in some areas.

QV said demand for bank-ordered valuations was a good indicator of future sales. In Tauranga, demand had dropped significantly. Hamilton was down about 5% and Whangarei was below its winter levels.

All three centres had previously benefited from the fact they were close to Auckland – but investors only needed a 20% deposit, rather than the 30% previously required in Auckland.

Analyst Nick Goodall said Auckland too had been affected – demand had not picked up as it usually would at this time of year.

“In Auckland [demand for valuations] remains flat compared to activity prior to the LVR announcement in late July. This is seasonally very weak as we would have expected activity from mid-winter to pick up in September,” he said.

But he said the factors driving house prices rises were still present, such as low interest rates, strong migration, and a lack of housing supply.

“All of this means it’s unlikely that values will be heading south any time soon, which will no doubt continue to draw the attention of both the Government and RBNZ. My pick? More intervention to come.”
BNZ chief economist Tony Alexander agreed. He said the market was in a holding pattern that was likely to last only a couple more months.

“That means the Reserve Bank will probably raise the minimum from 40% next year and implement restrictions on mortgage sizes as a multiple of household incomes of the borrowers. As always as has been our key point since the middle of 2009, the incentive for people contemplating making a purchase remains buy now rather than wait when prices will be higher and lending restrictions tougher.”

Tags: mortgages

« New LVR rules kick inTough lending times for investors »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 5.35 4.49 5.25 5.55
ANZ 5.54 5.15 5.85 6.15
ANZ Blueprint to Build 2.78 - - -
ANZ Special - 4.55 5.25 5.55
ASB Bank 5.35 4.49 5.25 5.55
Avanti Finance 5.45 - - -
Basecorp Finance 6.45 - - -
Bluestone 5.29 7.49 7.59 -
BNZ - Classic - 4.55 5.25 5.45
BNZ - Mortgage One 5.55 - - -
BNZ - Rapid Repay 5.55 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Std, FlyBuys 5.55 5.35 5.94 5.99
BNZ - TotalMoney 5.55 - - -
CFML Loans ▲6.45 - - -
China Construction Bank 5.50 5.40 6.14 6.40
China Construction Bank Special - 4.45 5.19 5.45
Credit Union Auckland 5.95 - - -
First Credit Union Special 5.85 4.70 5.20 -
Heartland Bank - Online 4.00 3.85 4.70 4.84
Heretaunga Building Society 5.95 4.80 5.50 -
HSBC Premier 5.49 4.39 5.15 5.39
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.25 4.29 5.09 5.35
Kainga Ora 5.43 4.57 5.58 5.85
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 5.00 5.55 6.19 6.39
Kiwibank - Offset 5.00 - - -
Kiwibank Special 5.00 4.55 5.19 5.39
Liberty 4.84 - - -
Nelson Building Society 5.95 4.95 5.85 -
Pepper Essential 3.44 - - -
Resimac 4.59 5.60 6.16 6.29
Lender Flt 1yr 2yr 3yr
SBS Bank 5.29 4.69 5.35 5.49
SBS Bank Special - 4.19 4.85 4.99
Select Home Loans 4.09 4.29 4.86 5.09
The Co-operative Bank - First Home Special - ▲4.19 - -
The Co-operative Bank - Owner Occ 5.45 ▲4.29 5.19 5.45
The Co-operative Bank - Standard 5.45 ▲4.79 5.69 5.95
TSB Bank 5.59 5.14 ▼5.79 6.15
TSB Special 4.79 4.34 ▼4.99 5.35
Unity 5.65 4.80 5.50 -
Wairarapa Building Society 5.24 4.55 5.20 -
Westpac 5.54 5.09 5.79 6.09
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.54 - - -
Westpac Special - 4.49 5.19 5.49
Median 5.45 4.55 5.25 5.52

Last updated: 19 May 2022 10:42am

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