Mortgage guide · New Zealand
Mortgage LVR & Deposits — New Zealand Guide
Learn how New Zealand mortgage loan-to-value ratio relates to your deposit, how to calculate LVR and why lender approval involves more than one percentage.
Reviewed 26 August 2026
Reviewed by KiwiTools editorial team — NZ mortgage researchers using Reserve Bank and government consumer sources
General information only, not financial, lending or legal advice. Confirm rates, fees, valuation and contract terms with the lender.
Key points
Mortgage LVR and deposit in brief
LVR equals the home-loan amount divided by the property value, multiplied by 100; deposit or equity is the remaining share before buying costs.
An owner-occupier loan above 80% LVR and an investor loan above 70% LVR fall into the Reserve Bank's current high-LVR categories.
The rules limit the share of new bank lending at high LVRs; they are not a personal approval threshold or promise of finance.
LVR examples for an $800,000 property
LVR is loan divided by the lender-accepted property value. Buying costs do not increase the deposit used in this ratio.
| Check | Deposit/equity | Loan | LVR |
|---|---|---|---|
| 10% equity | $80,000 | $720,000 | 90% |
| 20% equity | $160,000 | $640,000 | 80% |
| 30% equity | $240,000 | $560,000 | 70% |
| 40% equity | $320,000 | $480,000 | 60% |
LVR looks at the loan against accepted property value
A $600,000 loan on a $750,000 accepted value has an 80% LVR. The other $150,000 is 20% deposit or equity before separate buying costs.
If a lender adopts a value below the agreed price, the required cash can rise. The calculator cannot decide which valuation the lender will accept.
The Reserve Bank limit is a speed limit for banks
Current settings allow up to 25% of new owner-occupier lending above 80% LVR and up to 10% of new investor lending above 70% LVR. Those percentages limit a bank’s portfolio; they are not personal approval guarantees.
A bank can apply tighter credit standards, low-equity pricing and debt-to-income tests. Being inside an LVR category solves only one part of approval.
Read the related house deposit guideRead the related low equity margin guideRead the related how much house can i afford guide
Do not spend the buying-cost money on the deposit
Legal work, inspections, valuation, insurance setup and moving still need cash. A buyer who reaches exactly 20% by emptying every account can become fragile before settlement.
Build the deposit and purchase-cost targets separately. The strongest LVR is not automatically the safest household position.
Frequently asked questions
How do I calculate mortgage LVR?
Divide the loan amount by the property value and multiply by 100. For example, a $600,000 loan on a $750,000 property has an 80% LVR.
What deposit gives an 80% LVR?
A 20% deposit or equity share gives an 80% LVR when the loan and deposit together equal the property value, before separate purchase costs.
Can I get a mortgage with less than a 20% deposit?
Possibly. Reserve Bank limits allow a portion of new owner-occupier lending above 80% LVR, but approval, pricing and conditions depend on the lender and borrower.
What is the current investor LVR threshold?
Loans above 70% LVR are currently classed as high-LVR investor lending. Banks can make only a limited share of new investor lending above that level.
Is LVR the same as mortgage affordability?
No. LVR compares debt with property value. Affordability and approval also consider income, expenses, debts, credit, DTI, interest-rate testing and lender policy.
Put the guide into practice
Continue with related KiwiTools calculators
Test your own numbers, compare scenarios and return to the guide to check assumptions and limitations.