Credit crunched in Sydney and Melbourne ‘mortgage rings of fire’

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With the bank forecasting house price falls of up to 15 per cent, Mr Hand was asked if this meant ANZ would limit loan-to-valuation ratios (LVRs) in Melbourne.

Mr Hand responded that the 15 per cent fall forecast was a “worst case scenario” but it would impose LVR limits on some postcodes, and there were parts of the country where it would not lend more than 80 per cent of a property’s sale price. He said for some luxury properties it would limit LVRs on new loans to 70 per cent.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.