On Oct. 13, NZ CB said it will ease mortgage LVR restrictions.
NZ CB said it will ease mortgage loan-to-value ratio (LVR) restrictions from Dec. 1, 2025.
Easing of Restrictions
Acting Assistant Governor Financial Stability Angus McGregor explained introduction of debt-to-income (DTI) restrictions in 2024 allows LVR settings to be less restrictive on average.
DTI restrictions act as a guardrail for risky lending, supporting borrower resilience and helping to contain the severity of housing market corrections.
Relaxation of LVR settings will provide banks with more flexibility to lend, improve market efficiency, and enhance access to credit, particularly for first home buyers.
For owner occupiers, the limit on the share of new lending with an LVR above 80% will rise to 25%; for investors, the limit on the share of new lending with an LVR above 70% will rise to 10%.
NZ CB will consult with banks on changes to their conditions of registration over the next two weeks, i.e., Oct. 13-27, 2025.
DTI restrictions will remain unchanged, as they are calibrated to limit high-risk lending during housing upswings and low interest rate periods.
Effectiveness
The easing of restrictions will be effective from Dec. 1, 2025.
Oct. 14, 2025 NZ GVT Comments
On Oct. 14, 2025, NZ GVT said Finance Minister Nicola Willis welcomed NZ CB’s plan to ease lending restrictions, stating that it would benefit first home buyers.
