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ASB, BNZ, Westpac and Kiwibank indicate they will not be matching ANZ's requirement for housing investors to have 40% deposits at this stage

By David Hargreaves


Other large banks don't appear in a hurry at this stage to match the country's largest home lender ANZ in requiring housing investors to have 40% deposits.

The 40% move with immediate effect from ANZ on Tuesday goes further than the recommendations of the Reserve Bank, which is moving to have 30% deposits for investors in place by March.

Kiwibank, ASB, Westpac and BNZ have all declined to follow suit, at least for the moment.

The move from ANZ comes as the housing market has absolutely taken off with prices having risen by 18.5% in the past 12 months.

The RBNZ is currently consulting to reintroduce loan to value ratio (LVR) restrictions, which it removed in May.

The proposal from the RBNZ is to reinstall the restrictions exactly as they were when removed in May. This means 30% deposits for investors and 20% for owner-occupiers, with banks able to lend up to 20% of their new mortgage lending for loans in excess of 80% of the value of the property (IE for deposits of under 20%). Most major banks have already adopted these rules ahead of the planned March reintroduction.

But now ANZ has gone further. The 40% deposit level for investors actually aligns to what the requirement was back in mid-2016 when, with more than a hint of desperation, the RBNZ slammed 40% deposits on all investors. It worked. Subsequently these rules were relaxed over the past two years as the heat came out of the housing market.

We approached the other big four banks for comment.

ASB executive general manager for retail banking Craig Sims said: "We believe a balanced and sustainable housing market is in the best interests of all New Zealanders, and we are committed to playing our part in helping first home buyers get onto the property ladder. As part of this, we made changes to our lending criteria last month, requiring a greater [30%] deposit from investors. We continue to monitor developments in the housing market and we regularly review our credit settings, and will make changes as appropriate."

A Kiwibank spokesperson said: "At this stage Kiwibank will maintain its current loan-to-value ratio (LVR) settings. These settings align with Reserve Bank LVR restrictions. For property investors Kiwibank requires a 30% deposit and owner occupiers a 20% deposit which we consider appropriate. It’s something we consistently review, and we’ll continue to consider our response to market conditions."

A Westpac spokesperson said: "While we regularly review our LVR settings, we currently have no plans to change our deposit requirements for residential investors. We have taken a consistent and responsible approach to lending throughout the year, and did not change our lending criteria when the RBNZ removed its LVR 'speed limit' restrictions in April.”

A spokesperson for BNZ said that bank was "sticking with 30% for now" in terms of deposits for investors.

It is not the first time ANZ has talked about going further than the RBNZ official rules. In 2016 then ANZ NZ chief executive David Hisco suggested 60% deposits for investors.

In the New Zealand market, ANZ is a very big player. It accounts for just under a third of the total mortgage lending.

ANZ's managing director of personal banking Ben Kelleher said the bank's decision followed two months of record levels of mortgage lending.

In those two months some 32.4% of the new mortgage lending had gone to investors, while 18.3% had gone to first home lenders.

“Escalating property prices are putting home ownership out of reach for many Kiwis," Kelleher said.

"The current settings favour property investors particularly over first home buyers, potentially locking a generation of New Zealanders out of home ownership.

“It’s in everyone’s interests for residential property prices to be sustainable long term, and for home ownership to be accessible to as many people as possible.

“As New Zealand’s largest home lender, decreasing the LVR on residential investor lending is one thing we can do to help bring balance to the residential property market.”

This story was originally published on and has been republished here with permission.