International Monetary Fund says LVR limits work in boom times, not busts

Thu, 19 Mar 2015

By Fiona Rotherham March 19 (BusinessDesk) - Restrictions on low-deposit home loans appear to have more effect in times of boom rather than bust, according to an International Monetary Fund working paper. The paper released this month studies the use of macroprudential policies in 119 countries from 2000 to 2013, including loan-to-value ratio speed limits which were introduced in New Zealand in 2013. “Borrower-based policies such as limits on LTVs and DTIs, and financial institutions-based policies, such as limits on leverage and dy...

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