Back in the mid-2000s, New Zealand homebuyers had easy access to 95%, 100% or even higher home loans from the major banks.
House prices were much lower, too, and together these two factors made it easier for young Kiwis to buy their first house. Since the GFC caused a crack-down on lending practices, we haven’t seen any advertised 100% home loans. The closest is probably the 95% ASB loan for KiwiBuild buyers.
However, in the UK the 100% home loan is back on the books. There’s some sleight of hand, as someone in the borrower’s family must put a 10% deposit into the bank for three years. Still, it’s an interesting return to the kind of lending practices we saw before the GFC. In New Zealand, our responsible lending code means this isn’t likely to be possible, but banks do have the ability to lend over 80% to homeowners (and over 70% to investors) if the numbers are right. It will cost you a low-equity margin, but with the price of borrowing remaining at historic lows this may still add up.