RBNZ intends to ease mortgage loan-to-value ratio (LVR) restrictions from 1 December 2025
- For owner occupiers, the limit on the share of new lending allowed with an LVR above 80% will increase to 25%
- Also reviewed our DTI restrictions and decided to keep settings unchanged
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DTI is Debt-to-income
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Housing market: The move should support first-home buyers and lift housing demand modestly.
Banking sector: Slightly greater flexibility for lenders, but the RBNZ’s retention of DTI limits signals a cautious approach to household leverage.
Policy outlook: The easing underscores the RBNZ’s confidence in financial stability and may complement expectations for gradual monetary easing in 2026 if inflation continues to moderate.
NZD/USD is down a few tics on the announcement.
