Reserve Bank at 'sixes and sevens' on debt-to-income

Bank wants to nip 'boom and bust' cycle in the bud. (Image: Getty)

Tue, 23 Jan 2024

The Reserve Bank of New Zealand is proposing a "speed limit" on banks that will mean no more than one-fifth of their residential lending book can go to owner-occupiers seeking to borrow more than six times their income and investors seeking to borrow more than seven times their income.The restrictions are part of the new debt-to-income ratio (DTI) and are intended to act as another "financial stability" tool.In tandem, the Reserve Bank of NZ (RBNZ) has proposed easing its loan-to-value ratio restrictions (LVR) to 20% of lend...

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