Australia’s riskiest suburbs for home loans

A new crackdown on property lending has emerged in the wake of the Banking Royal Commission, with borrowers now being asked for deposits of up to 30 per cent and banks throwing greater scrutiny on location and living expenses when assessing loans.

In the new lending environment, one of the biggest shocks for borrowers is that the crackdown applies not just when accessing new credit, but also when refinancing existing loans.

In the higher-risk suburbs, banks have applied tighter lending criteria and required borrowers to find larger deposits to avoid paying costly mortgage insurance on top of their loans.

Perth is the capital city that tops the nation for the riskiest suburbs, and regional Western Australia is also home to the vast majority of blacklisted postcodes

The three riskiest places in the country as assessed by DFA all fall within regional WA.

The towns of Newdegate, Bodallin and Pithara were each assigned the nation's highest risk score of 46.1, compared with 27.9 for the suburb of Perth, 17.5 for Melbourne and 11.4 for Sydney.

Brisbane and Adelaide, which have both seen limited property growth in recent years, are close behind Perth in terms of risk to lenders.

While Melbourne and Sydney have led the nation in housing market growth in recent years, a downturn stretching for more than 18 months has resulted in the number of risky suburbs in both cities starting to increase

Hobart has defied the national property downturn in recent years, but the latest figures from property monitoring firm CoreLogic and the Real Estate Institute of Tasmania show the city's property boom is officially over.

In Canberra risk was relatively much lower across the board. The riskiest postcode — 2600, which includes the CBD — was seen as a safer bet than all but one suburb in WA, North Fremantle.


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 Source: https://www.abc.net.au/news/2019-05-09/australia-riskiest-suburbs-for-home-loans-revealed/11056136


Marlene Liontis
Wednesday, 15 May 2019

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