Australia’s largest financial services group, AMP, have announced that over 140 suburbs have been added to a confidential blacklist.
Which suburbs are on the blacklist?
73 of Queensland’s suburbs have been added to the list, we think our clients would be most interested in the following areas:
What is a blacklist?
A blacklist is a internal document where a lender or bank records suburbs with significantly higher lending risks than comparable suburbs.
In this case, AMP notes concerns over the amount of off the plan developments in Australia’s largest cities.
What does this mean for you?
People who are refinancing or purchasing a property in the above suburbs may experience stricter lending criteria where a higher income or a larger deposit could be required.
For example, an investor purchasing an inner city apartment for $500,000 may have previously needed a deposit of $35,000. Now, a deposit of up to $55,000 may be required!
For many investors, this could be the make or break of purchasing a new property.
On a grander scale, there are broad economic implications for property prices in capital cities. Excess supply causes disequilibrium and is likely to reduce general property prices. Market spillover could also cause price reductions in the property prices of surrounding suburbs.
What can you do about it?
This is where a mortgage broker comes in. We have discussed the blacklist with several lenders on our panel and got the inside scoop on how to structure and prepare your loan so that the effects of the blacklist are reduced as much as possible. So once again, it is in your best interest to talk to a broker and ensure that the maximum likelihood of having your finance approved.