PHOTO: Latest Reserve Bank mortgage lending figures show Kiwis borrowed $7.3 billion in September, up 32.8 percent on last year. Photo credit: Getty.
The combination of record-low mortgage interest rates and removal of LVR restrictions have caused mortgage lending to skyrocket to record levels.
New Reserve Bank mortgage lending figures show Kiwi homeowners borrowed $7.3 billion in September, up 32.8 percent compared to the same time last year.
The figures show the amount of borrowing based on loan-to-valuation ratio (LVR) restrictions: the percentage of borrowing compared to property value. In May, the Reserve Bank removed LVR restrictions for 12 months, effectively allowing banks to lend more money to those with deposits less than 20 percent of the property value, including first home buyers and investors.
Since May, loans over 80 percent (LVR above 80 percent), have increased 53.2 percent, from $515 million to $789 million. Loans to investors (LVR above 70 percent) more than tripled, increasing from $361 million to $1.1 billion.
READ MORE VIA NEWSHUB
