A Stuff article.
The Reserve Bank has proposed reducing the amount of lending banks can do for mortgages above a high loan-to-value ratio (LVR) of 80 per cent, from 20 per cent to 10 per cent of their all new housing loans.
Consultations will start with banks later this month, with a view to introducing the new rule in October.
It will also consult in October on implementing debt-to-income (DTI) restrictions and/or “interest rate floors” to prevent house buyers getting over their heads with debt.