It is inevitable that other banks will match the ANZ and increase their investor deposit requirements to 40 per cent say mortgage brokers.
But the major banks say they currently have no plans to change the settings on their investor lending restrictions.
On Tuesday ANZ NZ - the country's largest bank - announced it would increase its deposit requirements from 30 per cent to 40 per cent for investors effectively immediately.
ANZ also called for the Reserve Bank to set the loan to value ratio for property investors at 60 per cent rather than the 70 per cent currently being proposed by the central bank.
Loan Market mortgage broker Bruce Patten said ANZ's move was interesting and it was inevitable the other banks would go the same way.
"Otherwise they will be overrun with business and they are already under the pump at the moment and not keeping up."
Patten said he saw the ANZ hike as a move to show the Government the bank was willing to help control things rather than the Government allowing the Reserve Bank to introduce DTI's [debt to income ratios] which he described as "a ridiculously blunt instrument".
"Given the Reserve Bank doesn't want to and can't increase interest rates any time soon, they are looking for other ways to keep the market at bay."
Jeff Royle, a mortgage broker at iLender, said he did not believe the increased ANZ restrictions would stop investors from buying property.
He said ANZ's move could be the bank trying to curry favour with regulators or slow-down the flow of mortgage applications.
Royle said the ANZ currently had a poor reputation in the broker community for its service and slow turnaround of applications.
He said the bank's inability to process deals within two or three weeks meant that advisers were dealing with very unhappy property buyers.
"You can blame Covid to a certain extent and ANZ isn't alone - the other banks aren't significantly better - they have all had their issues.
"But ANZ just seems to be out of all proportion and considering they are a very big organisation you would have thought they would have got their act together sooner and addressed the issues but they are just not."
Royle said his phone was ringing "red hot" at the moment with people wanting to get deals over the line before the other banks clamped down and also bought in higher deposit rates.
"It wouldn't surprise me if the other banks followed suit."
CoreLogic senior economist Kelvin Davidson said it remained to be seen if other banks would follow suit but he now believed it was "fairly likely" the Reserve Bank would enforce a 40 per cent deposit requirement for investors.
"But it would certainly now be no surprise if the RBNZ just decided to mandate 40 per cent at some stage next year."
If it happened it would not be the first time the Reserve Bank had clamped down that tightly on investors.
But banks are so far staying tight-lipped on their plans.
A Westpac spokesman said while it regularly reviewed its LVR settings it currently had no plans to change its deposit requirements for residential investors.
"We have taken a consistent and responsible approach to lending throughout the year, and did not change our lending criteria when the RBNZ removed its LVR "speed limit" restrictions in April."
The spokesman said it would not comment on the ANZ's recommendation the RBNZ bring back a 60 per cent LVR for now.
ASB executive general manager Retail Banking Craig Sims said it made changes to its lending criteria last month increasing the investor deposit requirement back to 30 per cent.
"We continue to monitor developments in the housing market and we regularly review our credit settings, and will make changes as appropriate."
A BNZ spokesman said it did not have plans to change its LVR settings right now.
"Last month we increased LVR requirements for investors to help keep home ownership within reach for New Zealanders and support more sustainable prices in the residential property market.
"We are engaging with the RBNZ during their consultation period and welcome the opportunity to discuss these issues further."
ANZ's move has not been well received by a group representing property investors.
Sharon Cullwick, executive officer at the New Zealand Property Investors Federation, said increasing the investor deposit to 40 per cent was just a band aid to slow down the property market.
"The main problem is the lack of supply of houses and this is just a band aid to slow down the market and will not help!"
She also predicted it would make it harder for tenants to find a property to rent.
"People still have options to obtain cheap finance, so it won't slow down the housing market."