The number of people buying homes with a deposit of less than 20% is on the increase.

Banks are prevented from lending more than 10 per cent of their new loans to low deposit borrowers, which they say initially resulted in a drop because people thought they would be declined a loan.

Reserve Bank figures show that about 4.3% of new home loans in April were to borrowers with less than 20% deposit. In March it was 3.6%.

Kiwibank commented that the number of borrowers are starting to pick up again.

Source: NZ Herald

The Loan-to-Value-Ratio (LVR) limits have taken their toll on the banks with banks showing a reduction in the value of their loans business, as result of the shrinkage in high LVR lending.

The amount the banks lost (in lending terms) depended on how conservative they have been in terms of their exposure to high LVR mortgages.

Source: Stuff