Macquarie Bank is planning to hit the brakes on lending to high rise and high density apartment dwellings in up to 120 postcodes around the nation amid growing fears about falling demand and oversupply.

A confidential memo from the bank to brokers announces that from May 23 it will require a maximum loan to value ratio of 70 per cent, which means buyers will have to stump-up another 10 per cent deposit.

Doug Lee, head of sales and distribution, has written to brokers about "important changes to credit policy" about lending to single and multiple apartment buyers in popular high rise postcodes.

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More than 210,000 apartments are expected to flood into Melbourne and Sydney over the next two years, which is the equivalent to the existing number of apartments for sale, according to analysis by RP Data Core Logic, which analyses property sales and rents.

The likely number is expected to fall short as projects are cancelled because of falling local and overseas demand, particularly as the clamp on borrowing from overseas buyers and investors begins to bite.