The Reserve Bank's carrying out plans to tighten Loan-to-Value Ratios, to reduce risky mortgage lending
The Reserve Bank's carrying out plans to tighten Loan-to-Value Ratios, to reduce risky mortgage lending
23 September 2021
From November, it will restrict the low-deposit lending banks can do, from 20-percent of all new loans to just 10-percent.
All other lending will require a deposit of at least 20-percent.
Deputy Governor Geoff Bascand says despite previous LVR adjustments, house prices remained unsustainable and the risks of a housing market correction kept rising, increasing risks to economic and financial stability.
He says restricting high-risk lending will help prevent these problems worsening.
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