New Zealand LVR & Deposit Calculator

Your LVR is the loan as a percentage of the property's value. A $560,000 loan on a $700,000 property is an 80% LVR, so your deposit or equity is the other 20% ($140,000). Divide the loan by the value and multiply by 100. On a purchase, use the price; on a top-up or refinance, use the bank's current valuation and your loan balance.

For an existing home, owner-occupiers generally need at least a 20% deposit (an 80% LVR) and investors generally need about 35% (a 65% LVR). These come from the Reserve Bank's LVR restrictions. Newly built homes are exempt, and eligible first-home buyers can sometimes get in with as little as 5% through the Kāinga Ora First Home Loan.

When your deposit is under 20% (an LVR above 80%), banks usually add a low-equity margin, sometimes called a low-equity premium, to your interest rate. It is New Zealand's version of the mortgage insurance charged in Australia or the US, but it is a rate loading rather than a separate policy. It typically applies only while your LVR stays above 80%, so it can fall away as you repay or as the property's value rises.

The Reserve Bank sets a lower LVR limit for investors, generally a 35% deposit for an existing property, because investor lending is treated as higher risk to the financial system. Banks can lend a small share of new lending outside the limits, and new builds are exempt, so there is some flexibility, but for a standard investment purchase the 65% LVR ceiling usually applies.

Often, yes. Below 80% you avoid the low-equity margin, and some banks reserve their sharpest rates or cash contributions for lower LVRs. Getting under 80% is usually the most valuable threshold to cross, both to remove the margin and to widen the range of deals available to you.

Three ways: put in a larger deposit, buy a lower-priced property, or, if you already own, let repayments and any rise in the property's value build your equity over time. Each principal repayment reduces the loan and nudges your LVR down, which is why some buyers make a lump-sum repayment specifically to drop under 80% before refinancing.