PHOTO: CAMERON BURNELL/FAIRFAX NZ Former Reserve Bank Governor Graeme Wheeler said LVR restrictions would be good for first-home buyers in the long run – and he might have been right.

Opinion: Loan-to-value ratios (LVRs) hold a special place in my heart.

The controversial caps on low-deposit mortgages were introduced back in 2013. As a fledgling reporter, this was my first big story.

These were only “temporary measures”, I wrote. After all, the Reserve Bank had previously rejected them for being too intrusive.

Oh, the naivety of youth!

Here we are, six years later, and the RBNZ has once again dashed hopes that it might finally lift the restrictions.

Cue another round of opinion headlines about the plight of first-home buyers, and investors receiving an unfair advantage.

But how bad is it, really?

Having taken a fresh look at the statistics, I think the narratives around LVRs need some updating:

The LVR limits weren’t about house prices

It’s hard to say whether LVRs had any long-term cooling effect on house prices: maybe in Auckland, probably not in the rest of the country.


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