Loan-to-value ratio (LVR) restrictions are bad news for budding property investors.

But if you get the right advice, they don’t need to be a thorn in your side.

LVR restrictions are a strategy employed by New Zealand’s Reserve Bank to limit the sort of uncontrolled lending that might eventually lead to a housing crash. They make it more difficult for individual investors to gain access to low-deposit loans. Any loan that makes up more than 70%* of a property’s total value, for example, might be classed as a high-LVR loan. Only 5% of a bank’s loans are allowed to fall into this category, meaning most investors must put down a 30% deposit on any property they purchase.

*Note: All of these numbers can fluctuate over time.

Fortunately, there are ways to exempt yourself from these restrictions, such as by purchasing new buildings which can be funded at 80% or using loans for remediation. Given how riddled with both pitfalls and opportunities the market is, the best way to navigate it is by seeking the help of an experienced property investment advisor.

At One50 Group, we aim to find a solution that corresponds to your circumstances and ambitions, rather than forcing a one-size-fits-all approach on you. Or to put it more simply: we listen to what you want before we advise you.

If you want to learn more about LVR restrictions or simply discuss your portfolio, contact our friendly team today to arrange a free consultation.