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Investor activity waning?

Recently reimposed loan to value ratio restrictions are having a cooling effect on the investor market, according to a new survey. 

Tuesday, March 9th 2021, 10:17AM

A net 5% of people are planning to invest in residential property according to economist Tony Alexander's latest survey, down from a net 11% last month, and 13% in December.

The former BNZ economist said the findings "supports a view that reintroduction of the 40% minimum deposit requirement for new investor borrowers is curtailing some property demand".

Alexander's findings come as part of his Spending Plans Survey, released each month. 

They coincide with the reintroduction of LVR rules by the Reserve Bank. 

LVR rules are being phased in.

As of March, investors need a 30% deposit to buy an existing property. 

But from May 1, investors will need a 40% deposit, with banks limited to providing 5% of their book to high LVR investors. 

The RBNZ wants banks to impose 40% deposit limits "immediately".

Alexander said the reintroduction of LVR rules was "starting to skew the residential property market towards owner-occupiers. But these are very early days yet and it would not be possible on the basis of these results [or those in Alexander's two other recent surveys] to conclude that the housing markets around New Zealand are going to flatten out substantially in the near future.

"There is merely evidence of some frenzy washing away," he added.

Tags: investor lending LVR property investment Tony Alexander

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Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 ▼2.25 2.59 ▲2.89
ANZ 4.44 2.89 3.25 3.39
ANZ Special - 2.29 2.69 2.79
ASB Bank 4.45 ▼2.25 2.59 ▲2.89
Basecorp Finance 5.49 - - -
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.29 2.59 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 2.89 3.19 3.39
BNZ - TotalMoney 4.55 - - -
Lender Flt 1yr 2yr 3yr
CFML Loans 4.95 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland Bank - Online 2.50 1.99 2.35 2.45
Heretaunga Building Society 4.99 3.40 3.50 -
HSBC Premier 4.49 2.25 2.35 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - 2.25 - -
ICBC 3.69 2.25 2.35 2.65
Kainga Ora 4.43 2.67 2.97 3.13
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.40 3.20 3.50 3.50
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.35 2.65 2.65
Liberty 5.69 - - -
Nelson Building Society 4.95 3.20 3.24 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
Lender Flt 1yr 2yr 3yr
SBS Bank 4.54 2.79 2.99 3.29
SBS Bank Special - 2.29 2.49 2.79
Select Home Loans 3.49 3.34 2.99 3.34
The Co-operative Bank - First Home Special - 2.09 - -
The Co-operative Bank - Owner Occ 4.40 2.29 2.59 2.79
The Co-operative Bank - Standard 4.40 2.79 3.09 3.29
TSB Bank 5.34 3.09 3.29 3.45
TSB Special 4.54 2.29 2.49 2.65
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 3.09 3.29 3.39
Westpac - Offset 4.59 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 2.29 2.69 2.79
Median 4.55 2.73 2.99 2.89

Last updated: 23 April 2021 8:50am

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