It hopes the decision will “bring balance” to the property market
ANZ New Zealand has announced that it will be requiring a 40% deposit from residential property investors, effective immediately.
The new requirement for 60% LVR is up from the former 30%, and ANZ says there will be no changes to the deposit amounts required by others seeking a home loan, including first-time home buyers.
ANZ managing director, personal, Ben Kelleher said the bank has been monitoring the impact of a historically low interest rate environment on property prices, along with the impact of reduced LVR requirements and supply versus demand issues. He said ANZ will be asking the Reserve Bank of New Zealand to set a mandatory 60% LVR on property investor lending, as home ownership continues to spiral further out of reach with house prices showing no signs of slowing down.
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“We’ll be consulting with the Reserve Bank of New Zealand early next year, and will be recommending that LVRs be set at 60%, rather than the 70% that has been proposed,” Kelleher said.
“Requiring a 40% deposit from residential property investors, up from the current 30%, is a step we can take right now to help bring balance to the housing market. The current settings favour property investors particularly over first home buyers, potentially locking a generation of New Zealanders out of home ownership.”
Kelleher noted that 32.4% of ANZ’s lending over the past two months has gone to residential property investors – a record figure. He said that accessibility to home ownership is something that is “in everyone’s interests,” and needs to be sustainable over the long term.
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When it comes to other measures and a potential Capital Gains Tax, which the current government has been under increasing pressure to introduce, Kelleher said ANZ would follow the guidance of all upcoming consultation processes.
“Whether or not to bring in a CGT is a matter for the government,” Kelleher said. “We’re doing our bit by decreasing the LVR on residential lending to help bring balance to the housing market.”
