Property investors say they don't want debt-to-income restrictions on home lending to apply to them.
The Reserve Bank wants to be able to use debt-to-income restrictions, which limit the amount people can borrow based on their income. Photo: 123RF
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Reserve Bank is weighing up further measures to limit the amount people can borrow, in an effort to prevent buyers falling into debt if interest rates were to rise.
The central bank wants to add debt-to-income (DTI) restrictions, which limit the amount people can borrow to a multiple of their income, to its toolkit to control the property market and reduce the risk to banks.
The Reserve Bank last week said it would not use such restrictions in the current market but wanted them among its options alongside loan-to-value ratios, which are currently in place.
But Property Investors' Federation executive officer Andrew King said decisions about risky lending should be left to borrowers and their banks.
If the Reserve Bank does push ahead with the restrictions, he said property investors should be exempt, as is the case in Britain and Ireland.
"It's because we don't want to see the cost of providing rentals go up, rents to go up and make it even harder for tenants to save that deposit for their first home."
Mr King said there was already a shortage of rental housing.
