PROPERTY

Buying property? The suburbs blacklisted by banks

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Be careful where you buy your next property.

Even though you may like the location, your bank may not.

Did you know that all the banks have "blacklisted suburbs" - suburbs where they are not keen on lending and where borrowers face tougher hurdles to get a mortgage and have to stump up a bigger deposit.

In fact, some banks have a list of suburbs where they are not prepared to lend at all, or particular new developments in which they feel they have an overexposure and are not prepared to "risk" taking on extra loans.

In general, these unpopular suburbs are inner city and near CBD locations where there is an abundance of new high density apartment complexes.

And this comes at a time when banks are tightening scrutiny of income received and household expenditure used in their serviceability models to assess loan eligibility, making it harder for property investors to get finance.

Last year confidential list of suburbs was sent to mortgage brokers by the big four banks and more recently Citi sent a note to brokers highlighting 34 Sydney postcodes, 27 in Melbourne and 12 in Queensland where it's loath to lend.

The good news is this list also highlights a number of suburbs where it is still keen to lend 90% LVR.

What does this mean for you?

If you're looking for a new home or investment property around 80% of your property's performance will be determined by its location and possibly only 20% by the specific property you buy in that location, therefore researching the correct location is critical.

This all has to do with demographics and wages growth which leads to affordability - not cheap properties, but locals who can afford to pay more for their homes.

So look for a location that is gentrifying or find an area where economic growth will create jobs and wages growth so that disposable incomes of the locals are growing strongly making housing more affordable.

And then make sure your bank is happy to lend you money to purchase in this location.

If you've already committed to buying a property off the plan it's a good idea to look into your lending situation as soon as possible as the landscape may have changed since you first committed to your purchase.

Speak with your broker to ensure you haven't bought in a suburb blacklisted by the traditional banks and possibly look for an alternative lender.

A selection of blacklisted postcodes

Sydney 2000
Ultimo 2007
Alexandria 2015
Waterloo 2017
Rosebery 2018
Botany 2019
Mascot 2020
Bondi Junction 2022
Stanmore 2048
Greenwich 2065
Longueville 2066
Chatswood 2067
Ryde 2112
North Ryde 2113
West Ryde 2114
Epping 2121
Sydney Olympic Park 2127
Strathfield 2135
Enfield 2136
Concord 2137
Liberty Grove 2138
Homebush 2140
Granville 2142
Parramatta 2150
North Rocks 2151
Castle Hill 2154
Kellyville 2155
Canterbury 2193
Campsie 2194
Lakemba 2195
Marrickville 2204
Arncliffe 2205
Rockdale 2216
Hurstville 2220
Melbourne 3000
East Melbourne 3002
West Melbourne 3003
St Kilda Road 3004
Southbank 3006
Docklands 3008
North Melbourne 3051
Melbourne University 3053
Carlton 3053
Princess Hill 3054
Sumner 3057
Collingwood 3066
Abbotsford 3067
Doncaster 3108
Doncaster East 3109
Richmond 3121
Hawthorn 3122
Auburn 3123
Box Hill 3128
South Yarra 3141
Darling 3145
Dandenong 3175
St Kilda 3182
Balaclava 3183
South Melbourne 3205
Albert Park 3206
Port Melbourne 3207
Brisbane City 4000
New Farm 4005
Fortitude Valley 4006
Hamilton 4007
Albion 4010
Chermside 4032
South Brisbane 4101
Buranda 4102
Greenslopes 4120
Coorparoo 4151
East Brisbane 4169
Seven Hills 4170

RateCity.com.au

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Comments
Susan
September 6, 2017 8.40pm

Where is the blacklist of suburbs for queensland.

Andrew Christopher
September 7, 2017 6.33am

Why do you only list Sydney and Melbourne blacklist post codes?
Not everybody lives in just these two cities!

Elena
September 7, 2017 8.38am

Can I please have the suburb postcodes for Queensland?

Money
Verified
September 7, 2017 9.44am

Hi Andrew,

While we understand that not everyone lives in Sydney and Melbourne, the majority of our readers are based in the Eastern states. Unfortunately we cannot publish the full list of 11,000 post codes, but if you have questions about a certain area, we'd be happy to check the list for you.

- Money team

Ash
October 7, 2017 3.00pm

Hi there,

Do we have any such list for WA?

thanks,
Ash

Chichi
November 26, 2017 5.35pm

My guess is all suburbs in WA are currently blacklisted 😜

Jas
December 7, 2017 7.57am

The suburbs in Canberra ? Thanks

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