You are using an older browser version. Please use a supported version for the best MSN experience.

All five banks move on property investment

NZN 20/07/2016 By Fiona Rotherham

All five of the country's leading retail banks have acted early to introduce restrictions on lending to property investors as part of the Reserve Bank's bid to slow the heated housing market.

The central bank said earlier this week it intends having the new lending restrictions requiring property investors to have at least a 40 per cent deposit for loans in force by September 1 and asked lenders to comply with the spirit of the new regulations immediately.

The regulations extend and expand the demand for a 30 per cent deposit on investment properties in Auckland introduced by the bank last year.

Last to the party was state-owned Kiwibank which said this afternoon it had "communicated the new restrictions to staff and will not accept applications that are not compliant with the proposed new speed limits".

Kiwibank said it will honour existing commitments made to customers and continue to "prioritise first home buyers and owner-occupiers as we have in the past".

The statement followed the Bank of New Zealand, ASB Bank, ANZ Bank New Zealand also introducing the restrictions on Thursday.

Westpac Banking Corp kicked off the early move when it announced its plans on Wednesday.

ANZ, the country's biggest lender, said it would extend the maximum loan to value ratio of 60 per cent for property investors across New Zealand, after previously only requiring a 30 per cent deposit in Auckland. It's also extended the 85 per cent LVR in Auckland owner-occupied homes across New Zealand.

The bank said it intends honouring all existing pre-approvals but any renewals will be subject to the new policy.

ANZ' chief executive David Hisco on Wednesday said property prices in Auckland were over-cooked and the ending of the property boom will be "messy".

image beaconimage beaconimage beacon