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  1. #1
    Join Date
    Sep 2003
    Location
    High up above and deep down under
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    10,915

    Default Landlords ignorant of upcoming LVR rules

    Landlords ignorant of upcoming LVR rules


    Landlords remain largely ignorant of new Reserve Bank rules which kick in next Sunday,
    demanding Auckland investors have 30 per cent deposits.

    A Westpac NZ online survey of 2000 property owners found only 5 per cent knew
    when the changes came into force, nearly 30 per cent had not heard anything about
    the changes and 53 per cent had heard something but did not know the details.

    Westpac concluded that property investors, particularly in Auckland, were worryingly
    unaware of the detail and implications around the new LVR regulations.

    An "alarming" 61 per cent of new investors had heard something but knew no details, the bank said.
    Of current property investors who are looking to buy again in the next 12 months,
    17 per cent had not heard anything about the pending changes and half had heard
    about them but knew no details.

    The Reserve Bank is tightening LVR rules to reign in Auckland investors,
    ensuring banks demand 30 per cent deposits for a mortgage secured against
    an investment property.


    The change comes into effect on November 1.
    Read more at
    http://www.nzherald.co.nz/business/n...ectid=11534291
    "There's one way to find out if a man is honest-ask him. If he says 'yes,' you know he is a crook." Groucho Marx

  2. #2
    Join Date
    Mar 2007
    Location
    Auckland
    Posts
    3,060

    Default

    Logical, as they are surveyng Landlords not Property Traders.

    Contrary to common misconception, most Landlords hardly ever buy anything more. They are too busy running their existing accomodation business.

  3. #3
    Join Date
    Apr 2004
    Location
    Auckland
    Posts
    1,923

    Default

    Far too low.
    Think of the poor children - make it 50% deposit for us evil Auckland investors.

    Nothing like stifling the supply of rentals to keep rents high - Bwa Ha Ha!!
    The three most harmful addictions are heroin, carbohydrates and a monthly salary - Fred Wilson.

  4. #4
    Join Date
    Jun 2004
    Posts
    10,447

    Default

    Quote Originally Posted by PC View Post
    Far too low.
    Think of the poor children - make it 50% deposit for us evil Auckland investors.

    Nothing like stifling the supply of rentals to keep rents high - Bwa Ha Ha!!
    Sounds fair.
    Of course if the prices were lower people could afford to buy a PPOR then they wouldn't need as many rentals

  5. #5
    Join Date
    Mar 2008
    Location
    Auckland Wide
    Posts
    1,244

    Default

    These blanket LVR rules have an impact on a lot more than investment properties. I often see some of my clients leveraging their rental properties for other things - like purchasing a business, expanding their business, cheaper funding for vehicles, renovations etc.

    I wonder if this slows other things down so that we will need lower interest rates later on.
    Hamish Patel | ph: 09 625 4693 | mob: 021 625 693
    My Website
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  6. #6
    Join Date
    Aug 2009
    Location
    All of New Zealand
    Posts
    837

    Default

    These restrictions only apply to Bank lending. There is still plenty of activity in the 80 to 85% space and some funds to 90% for really strong deals.
    80% interest only 5.29% fixed two years. 85% interest only 5.79% fixed two years, 90% interest only 6.29% fixed two years. No low equity premiums to be paid in addition either.
    www.ilender.co.nz
    Financial Paramedics

  7. #7
    Join Date
    May 2007
    Location
    Hamilton
    Posts
    3,635

    Default

    Quote Originally Posted by brokerman View Post
    These restrictions only apply to Bank lending. There is still plenty of activity in the 80 to 85% space and some funds to 90% for really strong deals.
    80% interest only 5.29% fixed two years. 85% interest only 5.79% fixed two years, 90% interest only 6.29% fixed two years. No low equity premiums to be paid in addition either.
    Very interesting, thank you!
    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.

  8. #8
    Join Date
    Aug 2009
    Location
    All of New Zealand
    Posts
    837

    Default

    Quote Originally Posted by Rosco View Post
    Very interesting, thank you!
    Very welcome, getting a lot of referrals from Auckland Accountants and Lawyers for people who have been 'caught out' with the new deposit requirements. 80% seems to be the right balance looking at the applications coming in.
    www.ilender.co.nz
    Financial Paramedics

  9. #9

    Default

    Quote Originally Posted by brokerman View Post
    Very welcome, getting a lot of referrals from Auckland Accountants and Lawyers for people who have been 'caught out' with the new deposit requirements. 80% seems to be the right balance looking at the applications coming in.
    Does it apply to Auckland only or Wellington too?

  10. #10
    Join Date
    Aug 2009
    Location
    All of New Zealand
    Posts
    837

    Default

    Quote Originally Posted by FASATRIX View Post
    Does it apply to Auckland only or Wellington too?
    The RB restrictions relate to Auckland region only. For Wellington Banks will go 80% standalone and non Banks to 90%
    www.ilender.co.nz
    Financial Paramedics


 

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