ASB further adjusts LVR restriction in support of first home buyers

ASB is immediately increasing the minimum deposit required from investors in a move to further address the rapid growth in home lending volumes.

ASB’s Chief Executive Officer Vittoria Shortt says, “We’re concerned the continued high levels of investor demand are unsustainable so effective immediately we are increasing the deposit required from investors to 40%, from the current 30%.”

It is the second time in three months ASB has adjusted its LVR restriction. In November, the bank proactively reinstated a 30% LVR restriction following the Reserve Bank of New Zealand’s announcement it was considering the reintroduction of loan-to-value restrictions (LVR) in March this year.

“We are very focused on being a prudent and responsible lender. We all have to play our part and this decision to immediately increase the deposit required from investors is about ensuring a balanced and sustainable housing market which is in the best interests of all New Zealanders,” says Ms Shortt.

Pre-approvals already in place are unaffected. The change will apply to home loan applications and top-ups which have not yet been conditionally or fully approved, and rollover of existing conditionally or full approvals at expiry.