* . *
  • About
  • Advertise
  • Privacy & Policy
  • Contact
Tuesday, September 2, 2025
Earth-News
  • Home
  • Business
  • Entertainment
    Country music star apologizes after drunken show ends with cops taking him down: ‘I’m not OK’ – PennLive.com

    Country Music Star Apologizes After Drunken Show Ends in Police Intervention: ‘I’m Not OK

    Comanche Nation Entertainment closes casino near Devol – KSWO 7News

    Comanche Nation Entertainment Closes Casino Near Devol in Surprising Move

    Erykah Badu Announces ‘Abi & Alan’ Album With The Alchemist Will Be Delayed – yahoo.com

    Erykah Badu Opens Up About the Delay of Her Highly Anticipated ‘Abi & Alan’ Album with The Alchemist

    If You Needed Some BTS Pics Of The Rock’s Tree Trunk Legs To Spice Up Your Day, We Got ‘Em – yahoo.com

    Need a Boost? Check Out These Epic BTS Shots of The Rock’s Tree Trunk Legs!

    Sabrina Carpenter’s pearl-clutching magic? Humor – CNN

    Sabrina Carpenter’s pearl-clutching magic? Humor – CNN

    South Park Is In Trouble And Needs To Change Course, Fast – yahoo.com

    South Park Faces Major Challenges and Must Adapt Fast to Survive

  • General
  • Health
  • News

    Cracking the Code: Why China’s Economic Challenges Aren’t Shaking Markets, Unlike America’s” – Bloomberg

    Trump’s Narrow Window to Spread the Truth About Harris

    Trump’s Narrow Window to Spread the Truth About Harris

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Trending Tags

    • Trump Inauguration
    • United Stated
    • White House
    • Market Stories
    • Election Results
  • Science
  • Sports
  • Technology
    China’s CATL sells stake in Finnish subcontract car manufacturer – Reuters

    China’s CATL Sells Stake in Finnish Auto Supplier in Strategic Move

    This Secret Technology Will Make The IPhone 17 Super Thin Air – VOI.ID

    How This Breakthrough Technology Will Make the iPhone 17 Incredibly Thin and Lightweight

    Gator football kicks off with excitement and new technology – WCJB | TV20

    Gator Football Kicks Off with Thrilling Action and Innovative Technology

    Marvell Technology (MRVL) Loses 18.6% as Growth Outlook Fails to Impress – Yahoo Finance

    Marvell Technology (MRVL) Loses 18.6% as Growth Outlook Fails to Impress – Yahoo Finance

    Propelling solar technology into a perovskite future – CORDIS

    Propelling solar technology into a perovskite future – CORDIS

    13 Top Technology Trends (2025) – Exploding Topics

    13 Game-Changing Technology Trends to Watch in 2025

    Trending Tags

    • Nintendo Switch
    • CES 2017
    • Playstation 4 Pro
    • Mark Zuckerberg
No Result
View All Result
  • Home
  • Business
  • Entertainment
    Country music star apologizes after drunken show ends with cops taking him down: ‘I’m not OK’ – PennLive.com

    Country Music Star Apologizes After Drunken Show Ends in Police Intervention: ‘I’m Not OK

    Comanche Nation Entertainment closes casino near Devol – KSWO 7News

    Comanche Nation Entertainment Closes Casino Near Devol in Surprising Move

    Erykah Badu Announces ‘Abi & Alan’ Album With The Alchemist Will Be Delayed – yahoo.com

    Erykah Badu Opens Up About the Delay of Her Highly Anticipated ‘Abi & Alan’ Album with The Alchemist

    If You Needed Some BTS Pics Of The Rock’s Tree Trunk Legs To Spice Up Your Day, We Got ‘Em – yahoo.com

    Need a Boost? Check Out These Epic BTS Shots of The Rock’s Tree Trunk Legs!

    Sabrina Carpenter’s pearl-clutching magic? Humor – CNN

    Sabrina Carpenter’s pearl-clutching magic? Humor – CNN

    South Park Is In Trouble And Needs To Change Course, Fast – yahoo.com

    South Park Faces Major Challenges and Must Adapt Fast to Survive

  • General
  • Health
  • News

    Cracking the Code: Why China’s Economic Challenges Aren’t Shaking Markets, Unlike America’s” – Bloomberg

    Trump’s Narrow Window to Spread the Truth About Harris

    Trump’s Narrow Window to Spread the Truth About Harris

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Trending Tags

    • Trump Inauguration
    • United Stated
    • White House
    • Market Stories
    • Election Results
  • Science
  • Sports
  • Technology
    China’s CATL sells stake in Finnish subcontract car manufacturer – Reuters

    China’s CATL Sells Stake in Finnish Auto Supplier in Strategic Move

    This Secret Technology Will Make The IPhone 17 Super Thin Air – VOI.ID

    How This Breakthrough Technology Will Make the iPhone 17 Incredibly Thin and Lightweight

    Gator football kicks off with excitement and new technology – WCJB | TV20

    Gator Football Kicks Off with Thrilling Action and Innovative Technology

    Marvell Technology (MRVL) Loses 18.6% as Growth Outlook Fails to Impress – Yahoo Finance

    Marvell Technology (MRVL) Loses 18.6% as Growth Outlook Fails to Impress – Yahoo Finance

    Propelling solar technology into a perovskite future – CORDIS

    Propelling solar technology into a perovskite future – CORDIS

    13 Top Technology Trends (2025) – Exploding Topics

    13 Game-Changing Technology Trends to Watch in 2025

    Trending Tags

    • Nintendo Switch
    • CES 2017
    • Playstation 4 Pro
    • Mark Zuckerberg
No Result
View All Result
Earth-News
No Result
View All Result
Home Business

Investors may see biggest impact of Reserve Bank’s lending limits

May 28, 2024
in Business
Investors may see biggest impact of Reserve Bank’s lending limits
Share on FacebookShare on Twitter

Young woman getting keys to new apartment from realtor. Family buys, rents new house. Customers or renters buy or rent real estate, close up

Photo: 123RF

Explainer – The Reserve Bank has announced it will introduce debt-to-income ratios and tweak the loan-to-value restrictions that apply to home loans, from the start of July.

But what does that mean, and is it going to make it easier or harder to buy a house?

Experts say it will be a big shift – particularly for investors – but the full effects won’t be seen immediately.

What’s changing?

The Reserve Bank says that from 1 July, banks will only be able to lend about 20 percent of their new lending to owner-occupier borrowers with a debt-to-income ratio of more than six. That means, if your household earns a combined $100,000, your loan will be limited to $600,000.

Banks will only be able to lend 20 percent of lending to investors with a DTI of more than seven.

The rules won’t apply to Kainga Ora loans, new builds or refinances.

At the same time, the bank will loosen the loan-to-value ratio (LVR) restrictions so that banks can lend 20 percent of their lending to owner-occupiers with deposits of less than 20 percent, from 15 percent at the moment, and 5 percent of lending can be done to property investors with equity or deposits of less than 30 percent, compared to 35 percent at present,

Why?

The Reserve Bank says the rules are designed to make sure the banks do not take on too much risky lending during “booms”. If people borrow loans that are large compared to their incomes, it becomes harder for them to service when times are tough.

How much difference will it make for buyers?

At the moment, not a lot. There is not much lending being done at high DTIs at the moment, probably because high interest rates make it unaffordable.

The rules are expected to be more of a handbrake when interest rates are low and things are a bit frothy.

CoreLogic chief property economist Kelvin Davidson said they could be significant in future.

Kelvin Davidson

Kelvin Davidson
Photo: SUPPLIED

He said people were probably downplaying the impact of DTI ratios, particularly on investors, because they would not have a big immediate impact.

“They are a big deal. In the longer term mortgage rates will come down again and that’s when DTIs will kick in.”

He said it would probably slow the rate at which property investors could accumulate more properties.

“Previously, under LVRs, if the market went up, there’s your next deposit. This is quite removed from that. It’s all about income and you can’t change that straight away.”

The rent that would come from a rental property would often not be enough of an income boost.

Davidson said earlier Reserve Bank modelling showed, with DTIs, it could take six or seven years for a property investor to build up equity from one purchase to buy another. He said that probably compared to two or three years at the moment.

“That’s the big shift that’s been under-reported or underappreciated. It’s a pretty big change but it will only become visible over the longer term.”

Property investment coach Michael Burge said he did not expect a DTI of seven to have too much impact.

“If they want to slow investors down, then they will just lower that DTI,” he said. “But the economy is stuffed and house prices are flat at best, and dropping in some areas still, so I don’t see the need for them to make it harder on investors.”

The Reserve Bank noted first-home buyers and those on lower incomes were expected to be mostly unaffected by the introduction of DTIs because they already faced other serviceability criteria.

As for the LVR changes, CoreLogic data shows owner-occupiers are already borrowing below the current limits.

Only 9 percent of new lending to owner-occupiers was to people with a deposit of less than 20 percent in April.

About 80 percent was to first-home buyers.

But Davidson said the change could provide a bigger benefit to investors, who currently have virtually no options for a loan if they have less than 35 percent deposit.

“Say you’ve got a 33 percent deposit, right now you can’t buy but in a month’s time you can, provided you meet the other serviceability testing… it might boost demand a little bit but I’m not expecting a massive boost because you’ve still got to service the higher mortgage rates and as an investor your rental yields are still low.”

What does it mean for house prices?

No caption

File pic
Photo: RNZ / Maree Mahony

The Reserve Bank said it would help ensure house prices remained at sustainable levels because growth in home loans would have to be more closely linked to income growth.

Davidson agreed it would probably mean that house price growth was slower. “We have seen 6 percent or 7 percent on average for a long time but it could be more like 4 percent because income growth is lower and this makes that linkage more clearly.

“I don’t think it suddenly restores housing affordability overnight but over time, if it can restrict house price growth to a lower pace it does prevent affordability getting even worse. If there are fewer investors in the market there’s more opportunity for other buyer groups – that’s a pretty big shift.”

Westpac economists said it could push investors to regions with lower house prices.

“Lower prices compared to incomes will make it easier to jump the DTI hurdle. Very highly priced regions – for example, the Queenstown Lakes region – would be correspondingly disincentivised for both first-home buyers and investors.

“Over time, this may influence investment flows and regional house price trends.”

Westpac still expected a price rise of 6 percent over 2024 and another 7 percent in 2025, alongside wage growth of 2 percent and 3 percent, respectively.

BNZ chief economist Mike Jones said he expected that the impact of DTIs would be seen on house prices in 2025.

“It’s one factor that could slow down any house price appreciation we do see next year as interest rates start to come down because you’re looking at a much harder limit than we see in the likes of LVRs.”

>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : RNZ – https://www.rnz.co.nz/news/national/518076/investors-may-see-biggest-impact-of-reserve-bank-s-lending-limits

Tags: biggestbusinessInvestors
Previous Post

Former Talisman Gold Mines boss fined $100k over online posts

Next Post

Low interest rate expectations ‘good indicator of future house prices’

The 1600: The Hell-Cycle of Political Prosecutions – Newsweek

The 1600: The Hell-Cycle of Political Prosecutions – Newsweek

September 2, 2025
Construction of forest ecological security patterns based on MSPA model and circuit theory in the Desertification Control forests in South China Karst – Nature

Construction of forest ecological security patterns based on MSPA model and circuit theory in the Desertification Control forests in South China Karst – Nature

September 2, 2025
Bringing life science to life: Park Crossing teacher recognized – WSFA

Bringing life science to life: Park Crossing teacher recognized – WSFA

September 2, 2025
Take flight: EH seventh-graders learn science through paper airplanes – The Daily Reporter – Greenfield Indiana

Soar to New Heights: Seventh-Graders Explore Science with Paper Airplanes

September 2, 2025
Marcos orders lifestyle audit of all government officials — Dateline Philippines – Asian Journal News

Marcos Initiates Comprehensive Lifestyle Audit of Government Officials to Boost Accountability

September 2, 2025
China’s CATL sells stake in Finnish subcontract car manufacturer – Reuters

China’s CATL Sells Stake in Finnish Auto Supplier in Strategic Move

September 2, 2025
Mariners call up top catcher prospect Harry Ford, which could help Cal Raleigh late in season – Yahoo Sports

Mariners Elevate Top Catcher Prospect Harry Ford, Strengthening Cal Raleigh’s Late-Season Push

September 2, 2025
ECB’s Lagarde warns of risk to world economy via Trump interference on Fed – Reuters

ECB’s Lagarde warns of risk to world economy via Trump interference on Fed – Reuters

September 1, 2025
The Resilient Engine: Investing in Poland’s Outperforming Economy Amid Global Slowdown – AInvest

The Resilient Engine: Why Investing in Poland’s Booming Economy Is a Smart Move Amid Global Slowdown

September 1, 2025
Country music star apologizes after drunken show ends with cops taking him down: ‘I’m not OK’ – PennLive.com

Country Music Star Apologizes After Drunken Show Ends in Police Intervention: ‘I’m Not OK

September 1, 2025

Categories

Archives

September 2025
MTWTFSS
1234567
891011121314
15161718192021
22232425262728
2930 
« Aug    
Earth-News.info

The Earth News is an independent English-language daily published Website from all around the World News

Browse by Category

  • Business (20,132)
  • Ecology (802)
  • Economy (820)
  • Entertainment (21,700)
  • General (16,805)
  • Health (9,861)
  • Lifestyle (835)
  • News (22,149)
  • People (822)
  • Politics (829)
  • Science (16,031)
  • Sports (21,319)
  • Technology (15,801)
  • World (801)

Recent News

The 1600: The Hell-Cycle of Political Prosecutions – Newsweek

The 1600: The Hell-Cycle of Political Prosecutions – Newsweek

September 2, 2025
Construction of forest ecological security patterns based on MSPA model and circuit theory in the Desertification Control forests in South China Karst – Nature

Construction of forest ecological security patterns based on MSPA model and circuit theory in the Desertification Control forests in South China Karst – Nature

September 2, 2025
  • About
  • Advertise
  • Privacy & Policy
  • Contact

© 2023 earth-news.info

No Result
View All Result

© 2023 earth-news.info

No Result
View All Result

© 2023 earth-news.info

Go to mobile version